10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________________________

FORM 10-K

_________________________________________

(Mark One)

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 27, 2021

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
‎FOR THE TRANSITION PERIOD FROM ______ TO ______

Commission File Number 0-19357

_________________________________________

Monro, Inc.

(Exact name of Registrant as specified in its Charter)

New York	16-0838627
(State or other jurisdiction ‎of incorporation or organization)	(I.R.S. Employer ‎Identification No.)
200 Holleder Parkway,
Rochester, New York	14615
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (585) 647-6400

_________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $.01 per share	MNRO	The Nasdaq Stock Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES x   NO o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. YES o   NO x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES x   NO o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). YES x   NO o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	x	Accelerated Filer	o
Non-Accelerated Filer	o	Smaller Reporting Company	o
Emerging Growth Company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  o

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. x

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES o   NO x

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, based on the closing price of the shares of common stock on The Nasdaq Stock Market on September 25, 2020 was $1,331,800,000.

The number of shares of Registrant’s Common Stock outstanding as of May 21, 2021 was 33,492,878.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s definitive Proxy Statement for its 2021 Annual Meeting of Shareholders to be held hereafter are incorporated by reference into Part III of this report.

TABLE OF CONTENTS

		Page
PART I
Cautionary Note Regarding Forward-Looking Statements		3
Available Information		4
Item 1.	Business	5
Item 1A.	Risk Factors	10
Item 1B.	Unresolved Staff Comments	16
Item 2.	Properties	17
Item 3.	Legal Proceedings	17
Item 4.	Mine Safety Disclosures	17
PART II
Item 5.	Market for the Company's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	18
Item 6.	Selected Financial Data	18
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	19
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	28
Item 8.	Financial Statements and Supplementary Data	29
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	57
Item 9A.	Controls and Procedures	57
Item 9B.	Other Information	57
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	58
Item 11.	Executive Compensation	58
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	58
Item 13.	Certain Relationships and Related Transactions, and Director Independence	58
Item 14.	Principal Accountant Fees and Services	58
PART IV
Item 15.	Exhibits and Financial Statement Schedules	59
Item 16.	Form 10-K Summary	61
Signatures		62

Monro, Inc. 2021 Form 10-K 2

PART I

Cautionary Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K contains “forward-looking statements” as that term is used in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they address future events, developments and results and do not relate strictly to historical facts. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements include, without limitation, statements preceded by, followed by or including words such as “anticipate,” “appear,” “believe,” “contemplate,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “see,” “strategy,” “vision,” “will,” “would” and variations thereof and similar expressions. Forward-looking statements are subject to risks, uncertainties and other important factors that could cause actual results to differ materially from those expressed. For example, our forward-looking statements include, without limitation, statements regarding:

•the potential effect of general business or economic conditions on our business, including the direct and indirect effects of the novel strain of coronavirus (“COVID-19”) pandemic on the economy, consumer spending levels, and unemployment in our markets;

•the uncertainty of the impact of the COVID-19 pandemic and public health measures on our business and results of operations, including uncertainties surrounding possible disruptions in our supply chain or sources of supply, the physical and financial health of our customers, the effectiveness and duration of government assistance programs to individuals, households and businesses to support consumer spending, levels of traffic in our stores, changes in customer demand for our services, and increased expenses for higher wages and compensation paid to employees and the cost of personal protective equipment and additional cleaning supplies and protocols for the safety of our employees;

•our expectations regarding cost increases in the future, including costs relating to our COVID-19 response initiatives, increases in the minimum wage by states and localities, potential federal minimum wage legislation, increases in distribution and fuel costs and potential new legal requirements to provide increased pay for employees who work during pandemic restrictions;

•the effect of economic conditions, seasonality and the impact of weather conditions and natural disasters on customer demand;

•the dependence on and our expectation regarding competition within the primary markets in which our stores are located;

•our growth plans, including our plans to add, renovate, re-brand, expand, remodel, relocate or close stores and any related costs or charges, our leasing strategy for future expansion, and our ability to renew leases at existing store locations;

•the impact of competitive services and pricing;

•the reliability of, and cost associated with, our sources of parts supply, particularly imported goods such as those sourced from China;

•the impact of trade relations and the ongoing trade dispute between the United States and China, including the actual and potential effect of Section 301 tariffs on Chinese goods imposed by the United States Trade Representative, uncertainties surrounding the policies of the new presidential administration, and other potential impediments to imports;

•the impact of industry regulation;

•our ability to service our debt obligations, including our expected annual interest expense;

•our cash needs, including our ability to fund our future capital expenditures and working capital requirements;

•our anticipated sales, comparable store sales, gross profit margin, costs of goods sold (including product mix), operating, selling, general and administrative expenses and other fixed costs, and our ability to leverage those costs;

•advances in automotive technologies;

•risks relating to disruption or unauthorized access to our computer systems;

•our failure to protect customer and employee personal data;

•business interruptions;

•potential outcomes related to pending or future litigation matters;

•risks relating to acquisitions and the integration of acquired businesses with ours;

•the effect of changes in labor laws, and the effect of the Fair Labor Standards Act as it relates to the qualification of our managers for exempt status, minimum wage and health care law;

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•our assessment of the materiality and impact on our business of recent accounting pronouncements adopted by the Financial Accounting Standards Board (“FASB”);

•management’s estimates and expectations as they relate to income tax liabilities, deferred income taxes and uncertain tax positions; and

•management’s estimates associated with our critical accounting policies, including business combinations, self-insurance liabilities and valuations for our goodwill and indefinite-lived intangible assets impairment analyses.

Any of these factors, as well as such other factors as discussed in Part I, Item 1A., “Risk Factors” and throughout Part II, Item 7., “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Annual Report on Form 10-K (“Form 10-K”), as well as in our periodic filings with the Securities and Exchange Commission (the “SEC”), could cause our actual results to differ materially from our anticipated results. The information provided in this Form 10-K is based upon the facts and circumstances known as of the date of this report, and any forward-looking statements made by us in this Form 10-K speak only as of the date on which they are made. Except as required by law, we undertake no obligation to update these forward-looking statements after the date of this Form 10-K to reflect events or circumstances after such date, or to reflect the occurrence of unanticipated events.

Introductory Note

Unless otherwise stated, references to “we,” “our,” “us,” “Monro” or the “Company” generally refer to Monro, Inc. and its direct and indirect subsidiaries on a consolidated basis. Unless specifically indicated otherwise, any references to “2021” or “fiscal 2021,” “2020” or “fiscal 2020,” and “2019” or “fiscal 2019” relate to the years ended March 27, 2021, March 28, 2020 and March 30, 2019, respectively.

Available Information

Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available free of charge on our website at www.monro.com as soon as reasonably practicable after electronic filing of such reports with the SEC.

Our investor presentation regarding the financial results for the fiscal year ended March 27, 2021 is available and accessible at Monro's Investor Relations page at https://corporate.monro.com/investors. Information available on our website is not a part of, and is not incorporated into, this Form 10-K. We intend to make future investor presentations available exclusively through our Investor Relations page.

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Item 1. Business

General

We are a leading nation-wide operator of retail tire and automotive repair stores in the United States. We offer to our customers, referred to as “guests”, replacement tires and tire related services, automotive undercar repair services as well as a broad range of routine maintenance services, primarily on passenger cars, light trucks and vans. We also provide other products and services for brakes; mufflers and exhaust systems; and steering, drive train, suspension and wheel alignment.

We believe the convenience and value we offer are key factors in serving and growing our base of customers. At March 27, 2021, we operated 1,263 retail tire and automotive repair stores and serviced approximately 4.8 million vehicles in fiscal 2021.

Our retail tire and automotive repair stores operate primarily under the names “Monro Auto Service and Tire Centers,” “Tire Choice Auto Service Centers,” “Mr. Tire Auto Service Centers,” “Car-X Tire & Auto,” “Tire Warehouse Tires for Less,” “Ken Towery’s Tire & Auto Care,” “Tire Barn Warehouse,” and “Free Service Tire & Auto Centers.”

Company-operated Store Brands as of March 27, 2021	Stores
Monro Auto Service and Tire Centers	375
Tire Choice Auto Service Centers	358
Mr. Tire Auto Service Centers	321
Car-X Tire & Auto	57
Tire Warehouse Tires for Less	55
Ken Towery's Tire & Auto Care	34
Tire Barn Warehouse	27
Free Service Tire & Auto Centers	10
Other (a)	26
Total	1,263

(a)Recent 2021 and 2020 acquisition stores to be converted to Tire Choice Auto Service Centers brand.

The typical format for a Monro store is a free-standing building consisting of a sales area, fully-equipped service bays and a parts/tires storage area. Most service bays are equipped with above-ground electric vehicle lifts. Generally, each store is located within 25 miles of a “key” store which carries approximately double the inventory of a typical store and serves as a mini-distribution point for slower moving inventory for other stores in its area. Individual store sizes, number of bays and stocking levels vary greatly and are dependent primarily on the availability of suitable store locations, population, demographics and intensity of competition among other factors.

A certain number of our retail locations also service commercial customers. Our locations that serve commercial customers generally operate consistently with our other retail locations, except that the sales mix for these locations includes a higher number of commercial tires.

As of March 27, 2021, Monro had seven wholesale locations and three retread facilities. The wholesale locations, in most cases, sell tires to customers for resale, although these tire sales do not include installation or other tire related services. The retread facilities re-manufacture tires through the replacement of tread on worn tires that are later sold to customers. Monro also had 95 Car-X franchised locations as of March 27, 2021. (Two franchised locations were closed during 2021.)

Our operations are organized and managed in one operating segment. The internal management financial reporting that is the basis for evaluation in order to assess performance and allocate resources by our chief operating decision maker consists of consolidated data that includes the results of our retail, commercial and wholesale locations. As such, our one operating segment reflects how our operations are managed, how resources are allocated, how operating performance is evaluated by senior management and the structure of our internal financial reporting.

Monro incorporated in New York in 1959. We maintain our corporate headquarters in Rochester, New York.

Business Strategy

Our vision is to be America’s leading auto and tire service center, trusted by consumers as the best place in their neighborhoods for quality automotive service and tires. We believe that success in this vision will position Monro to deliver consistent and sustainable organic growth as well as lead to strong, long-term financial performance. Specifically, we are committed to seeing this vision executed across all aspects of the business, through the following actions:

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•Exceed guest expectations. We will continue to invest in and execute strategic initiatives to improve our guests’ in-store experience. This ranges from modernized store infrastructure through rebranding and reimaging investments, new tire pricing and category management technology to match customer demand and building an omni-channel presence.

•Provide consistent value. We intend to be able to offer better value than new car dealers to more price-sensitive consumers. Vehicles generally need more service and repairs as they advance in age. However, as consumers’ vehicles age, the consumers’ willingness to pay higher prices decreases. Monro’s service menu is focused on items that are purchased frequently, like oil changes and other scheduled services, along with higher value services like tires, brakes and other undercar services. Our tire pricing and category management system allows us to dynamically track demand trends and make rapid adjustments to optimize our tire assortment by leveraging the breadth of our tire brand portfolio to offer the right tires at what we believe are the right price points.

•Build a committed, knowledgeable organization of friendly and professional teammates. We will continue to invest in technology and training to accelerate productivity and team engagement. This includes our data-driven cloud-based store staffing and scheduling software that re-balances our store technician labor to meet customer demand as well as utilizing Monro University, an extensive cloud-based learning curriculum, to provide our employees, referred to as “teammates,” with the technical training needed to effectively serve our customers today and into the future.

We are committed to building an omni-channel presence through our primary retail websites in order to create a seamless buying experience for our customers. With responsive optimized design for mobile users, a streamlined tire search and improved content and functionality, our retail websites better position us to address our customers’ needs. These websites, aligned with our primary retail names, help customers search for store locations, access coupons, make service appointments, shop for tires and access information on our services and products, as well as car care tips. Importantly, they better showcase the solutions we provide to our customers, including our Good, Better, Best product and service packages.

To minimize the impact of the COVID-19 pandemic on our business, we modified our plans for some of our strategic initiatives, including temporarily suspending all reimaging and rebranding investments related to our store transformation program during the first three months of fiscal 2021. With sales improvement throughout the year, we resumed these investments and completed the store transformation of 147 stores in fiscal 2021. To date, we have completed the transformation of 366 stores.

Growth Strategy

Executing on accretive acquisition opportunities remains a key element of our growth strategy. We have a robust pipeline and believe the fragmentation of our industry allows for many opportunities for consolidation. Using consumer demographic analytics, we believe we are able to better identify targets that operate in the markets with favorable demographics and customer trends, allowing us to enter regions from which we are poised to benefit most. Additionally, to ensure we are capitalizing on these opportunities, we have added talent and an organizational structure to our mergers and acquisitions team, who will work with our management team to ensure we capitalize on the momentum in the market.

During the last five years, we have completed 19 acquisitions, adding 262 locations and approximately $411 million in annualized revenue. Additionally, during this time, we have entered seven states, solidifying our presence in the Southern markets as well as expanding into the Western region. As of March 27, 2021, we have stores in 32 states.

Although acquisition activity was temporarily paused in response to the COVID-19 pandemic during the first six months of fiscal 2021, we continued to evaluate potential acquisition candidates that we believe would fit our growth strategy while maintaining financial discipline, and we acquired 17 retail tire and automotive repair stores located in California during December 2020.

Subsequent to March 27, 2021, we acquired 30 retail tire and automotive repair stores located in California from Mountain View Tire & Service, Inc. on April 25, 2021.

In addition to our plan to continue to seek suitable acquisitions, we plan to add new greenfield stores. Greenfield stores include new construction as well as the acquisition of one to four store operations.

Key factors in market and site selection for selecting new greenfield store locations include population, demographic characteristics, vehicle population and the intensity of competition. We partner with a customer analytics firm to provide market segmentation and demographic data specific to a geographic area in close proximity to a Monro location to identify high value lookalike customers and market directly to them. We attempt to cluster stores in market areas in order to achieve economies of scale in advertising, supervision and distribution costs. All new greenfield sites presently under consideration are within our established market areas.

Monro, Inc. 2021 Form 10-K 6

Purchasing and Distribution

We believe that our substantial buying power and our flexibility in making sourcing decisions contributes to our successful purchasing strategy. We also believe our ability to negotiate with our vendor partners allows us to ensure we are receiving competitive pricing and terms as well as minimize the margin impact of economic pressures such as tariffs.

We select and purchase tires, parts and supplies for all Company-operated stores on a centralized basis through an automatic replenishment system based on operational data we collect from stores on a daily basis. This allows us to control store inventory on a near real-time basis. Additionally, each store has access to the inventory carried by up to the 14 stores or distribution center nearest to it. Management believes that this feature improves customer satisfaction and store productivity by reducing the time required to locate out-of-stock parts and tires. It also improves profitability because it reduces the amount of inventory which must be purchased outside Monro from local vendors. Purchases outside Monro are made when needed at the store level and accounted for approximately 18 percent of all parts and tires used in 2021.

Our ten largest vendors accounted for approximately 73 percent of our total stocking purchases, with the largest vendor accounting for approximately 24 percent of total stocking purchases in 2021. In 2021, Monro imported approximately 26 percent of our parts (excluding batteries, oil and supplies) and tire purchases. We purchase parts, oil and tires from 98 vendors. Management believes that our relationships with vendors are excellent and that alternative sources of supply exist, at comparable cost, for substantially all parts used in our business.

We enter into contracts with certain parts and tire suppliers, some of which require us to buy (at market competitive prices) up to 100 percent of our annual purchases of specific products. These agreements expire at various dates. We believe these agreements provide us with high quality, branded merchandise at preferred pricing, along with strong marketing and training support.

The majority of our parts supply is distributed to our stores through our network of distribution centers, and vendors ship the majority of our tires supply directly to our stores. Stores are generally replenished at least bi-weekly, and such replenishment fills, on average, 96 percent of all items ordered by the automatic replenishment system. Monro operates eleven distribution centers in California, Kentucky, Maryland, New Hampshire, New York, North Carolina, South Carolina and Tennessee.

Human Capital

At Monro, our business success is built upon our dedicated, passionate and diverse teammates who work and live in the communities we serve. We are committed to providing a safe, healthy, inclusive and supportive work environment where teammates embrace our core value of collaboration, feel empowered and are motivated to have enriching and successful careers. We seek to be an employer of choice to attract and retain top talent. To that end, we strive to provide an engaging work experience that excites and motivates our teammates to deliver their best every day as well as provides opportunities for learning and growth, to ensure our team is always the best in the business.

As of March 27, 2021, Monro had approximately 7,800 employees, of whom 7,270 were employed in the field organization, 210 were employed at the distribution centers, 260 were employed at our corporate headquarters, referred to as store support center, and 60 were employed in other offices. Monro's employees are not members of any union. Due to the impact of the COVID-19 pandemic, we reduced our workforce through furlough or other reduction. With sales improvement, we adjusted our workforce to meet demand.

Teammate Retention

We understand that our teammates will benefit from a clear path to advancement and from investments in their continuous learning to allow them to achieve their personal development needs and career growth. To that end, we invest in training and development programs at all levels within the Company. We also leverage annual processes that support individual performance planning, individual professional development planning and a broad review of talent throughout our organization. Our continuous efforts are reflected in our turnover rates, which are our lowest since 2015.

During fiscal 2020 our online training platform, Monro University, was initially focused on the technical and operational excellence training that technicians need to effectively serve our customers today and prepare them to handle future requirements. We have since expanded the platform across a wide variety of topics accessible to our teammates in our stores, distribution centers and store support center.

New technician development has been an area of particular focus for Monro to increase productivity and retention and make it easier for technicians to overcome barriers of joining the industry. One way we do this is by offering a tool purchase program through which trainee technicians can acquire their own set of tools. We also provide Automotive Service Excellence (“ASE”) certification in eight different categories as technicians advance in their careers.

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Store and operations managers also have courses available through Monro University that are supplemented with live and on-line vendor training courses. Management training covers topics including safety, customer service, human resources, leadership and scheduling, and is delivered on a regular basis. We believe that involving operations management in the development and delivery of these sessions results in more relevant and actionable training for store managers, helping improve staff retention as well as overall performance.

Monro University also provides targeted training for corporate management and staff, including diversity training, harassment training and people manager training.

We also foster development through annual reviews at which time employees can discuss with their manager goals for aligning their own development with our business objectives.

The compensation for our teammates is tied to, and increases with, increased productivity. Our store compensation plan also streamlines bonus programs, creating consistency and providing us the ability to use human capital more productively across our stores.

In fiscal 2022, we will provide all teammates with an engagement and satisfaction survey, and intend to use those results to inform further strategy and goal-setting.

In addition to providing ongoing learning and development opportunities, ensuring our teammates feel supported is also important in teammate retention. Besides standard employee benefits we offer a confidential Employee Assistance Program with 24/7 support, financial counseling, estate planning, and online resources for parents whose children struggle with developmental disabilities, as well as other services aimed at enhancing our teammates’ well-being.

Workplace Safety

We are committed to providing a safe and secure work environment and have specific safety programs. To identify elevated safety-related risk areas more effectively, we have increased our focus on data gathering, tracking and analysis. With greater insight into real-time data, we can prioritize focus on areas that present the biggest potential hazards to our teammates and identify process improvements. Another important component of our risk analysis is conducting formal and thorough investigations into safety-related incidents. Investigations are analyzed by our Vice President of Risk and Safety as well as our Risk Management Team to determine a root cause, and pro-active plans are in place to improve safety related patterns that emerge, determining the next steps to address these patterns.

Monro’s training programs are key to our strong safety culture. Training increases awareness and helps to reduce and eliminate workplace accidents and injuries. Our Monro University platform has allowed us to conduct more robust and structured trainings based on a teammates’ job position, and Monro’s safety manuals are available at every workstation within our stores and distribution centers and serve as the basis for our safety training and protocols.

COVID-19

Given the significant impact of the COVID-19 pandemic, the end of fiscal 2020 and all of fiscal 2021 presented a unique set of challenges. In February 2020, we formed a COVID-19 Crisis Committee comprised of members of management that has been leading and coordinating the Company’s overall response. This team leads efforts to develop and monitor mitigation and business continuity plans; track all relevant state and local government guidelines, directives and regulations; develop work-from-home plans for non-store teammates; implement safe working protocols for store teams; assess appropriate return-to-office protocols; and provide timely and transparent communications to teammates and key stakeholders. We also incurred additional costs in procuring and distributing the supplies necessary to keep our teammates safe, such as cleaning supplies, face masks and other protective equipment, including sneeze guards installed at each sales counter, as well as investments in technology to allow our teammates to work remotely.

Diversity, Equity and Inclusion

Diversity is one of our core values and we are committed to driving diversity, equity and inclusion across our Company. This commitment will continue to be supported by training and awareness programs as well as focused efforts to recruit, retain, develop and promote a diverse workforce. Our Code of Ethics lays out a zero-tolerance policy for discrimination or harassment behavior.

We are taking action to increase the focus on our diversity efforts and are committed to making continuous progress. In 2020, we formed a Team Resource Group (“TRG”), comprised of a cross-functional coalition of teammates to educate and provide resources and training to help Monro build and maintain an inclusive culture where every teammate feels they belong, can contribute and are

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able to reach their full potential. A Diversity, Equity & Inclusion (“DE&I”) expert consultant and the TRG have also been working with the Senior Leadership Team to assist in the formulation of an official DE&I strategy which will include goals and a long-term plan.

We have also added resources to our recruitment team to help launch new hiring initiatives aimed at reaching diverse groups and are also expanding the recruitment platforms we use to broaden our pool of candidates.

We also view training as a tool to foster inclusion and, through Monro University, we provide Unconscious Bias Diversity and Inclusion Awareness courses to our teammates.

Competition

Our segment of the retail industry is fragmented and highly competitive, and the number, size and strength of competitors vary widely from region to region. We operate in the automotive repair service and tire industry, which is currently and is expected to continue to be highly competitive with respect to price, store location, name awareness and customer service. Monro's primary competitors include national and regional undercar, tire specialty and general automotive service chains, both franchised and company-operated; car dealerships, mass merchandisers’ operating service centers; and, to a lesser extent, gas stations, independent garages and Internet tire sellers. Monro considers TBC Corporation (operating primarily under the NTB, Midas and Tire Kingdom brands), Firestone Complete Auto Care service stores, The Pep Boys – Manny, Moe and Jack service stores, Meineke, and Mavis Discount Tire to be direct competitors.

Regulation

We maintain programs to facilitate compliance with various federal, state and local laws and governmental regulations relating to the operation of our business, including, among other things, those regarding employment and labor practices, workplace safety, building and zoning requirements, the handling, storage and disposal of hazardous substances contained in the products that we sell and use in our service bays, the recycling of batteries, tires and used lubricants, and the ownership and operation of real property. We believe that we are in compliance with these applicable laws and regulations, and our related compliance costs are not material.

Monro stores new oil and recycled antifreeze and generates and/or handles used tires and automotive oils, antifreeze and certain solvents, which are disposed of by licensed third-party contractors. In certain states, as required, we also recycle oil filters. Accordingly, we are subject to numerous federal, state and local environmental laws including the Comprehensive Environmental Response Compensation and Liability Act. In addition, the United States Environmental Protection Agency (the "EPA"), under the Resource Conservation and Recovery Act ("RCRA"), as well as various state and local environmental protection agencies, regulate our handling and disposal of certain waste products and other materials. The EPA, under the Clean Air Act, also regulates the installation of catalytic converters, engines and equipment sold or distributed in the United States by periodically spot checking repair jobs, and may impose sanctions, including but not limited to civil penalties of approximately $45,000 per violation (or approximately $45,000 per day for certain willful violations or failures to cooperate with authorities), for violations of RCRA and the Clean Air Act.

Monro strives to maintain an environmentally conscious corporate culture, demonstrated by our recycling policies at our offices, distribution centers and stores. In 2021, Monro recycled approximately 2.5 million gallons of oil and 3.3 million tires, as well as approximately 73,000 vehicle batteries and 316 tons of cardboard, all as part of our commitment to the environment.

Seasonality

Although our business is not highly seasonal, customers do purchase more undercar service during the period of March through October than the period of November through February, when miles driven tend to be lower. Sales of tires are more heavily weighted in the months of May through August, and October through December. The slowest months are typically January through April and September. As a result, profitability is typically lower during slower sales months, or months where mix is more heavily weighted toward tires, which is a lower margin category.

Sales can also be volatile in areas in which we operate as a result of warmer weather in winter months, which typically causes a decline in tire sales, or severe weather, which can result in store closures.

Given our use of a fiscal calendar, there may be some fluctuations between quarters due to holiday shifts in the calendar year and the number of days in a particular fiscal quarter or year. In addition, the COVID-19 outbreak has had an impact on consumer behaviors and customer traffic that may result in temporary changes in the seasonal fluctuations of our business.

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Item 1A. Risk Factors

In addition to the risks discussed elsewhere in this annual report, the following are the important factors that could cause Monro’s actual results to differ materially from those projected in any forward looking statements:

Risks Related to our Business

Matters related to the COVID-19 pandemic have and will continue to significantly and adversely impact our business, financial position, results of operations and cash flows.

The spread of COVID-19 has created a global public health crisis that has resulted in widespread volatility and deteriorations in household, business, economic and market conditions. We have experienced negative impacts to demand for our products and services from the COVID-19 pandemic, which has and will continue to adversely affect our results of operations, and we are continuing to experience significant disruption to our normal business operations and may experience further disruption to our planned implementation of certain strategic initiatives.

Our business will continue to be affected by the broader economic effects from the COVID-19 pandemic and related regulatory and individual actions, including customer demand for our products and services. Because more people in the United States are working from home, those workers will likely drive less often, and are less likely to require our services or will require our services less often. If this trend continues, we may see a permanent decline in demand for our services. Although travel by car may replace air travel as the preferred means of transportation because of fear of the spread of COVID-19, the recessionary economic environment resulting from the COVID-19 pandemic may reduce levels of leisure travel, which would reduce the demand for our products and services. We anticipate disruption to the demand for our products and services throughout the course of the pandemic. For example, in fiscal 2021, we experienced significant declines in comparable store sales compared to 2020 due to lower store traffic and reduced store hours as a result of our, individuals’, and governmental responses to the COVID-19 pandemic. Additionally, our growth strategy was impacted by the pandemic, as we paused all store acquisition, rebrand, and reimage initiatives during the first quarter of fiscal 2021 in order to focus our efforts on determining the full impact of the COVID-19 pandemic on our business before restarting them later in fiscal 2021. Given the continuing uncertainty during the pandemic, we may have to pause these initiatives again if necessary to mitigate the effects of the pandemic.

While we have so far been able to source required products at reasonable cost, the pandemic may also affect our supply chain in ways that are beyond our control. We may also incur costs or experience further disruption to comply with new or changing regulations in response to the pandemic.

In addition, our continuing response to the pandemic could divert management’s attention from our key strategic priorities, increase costs as we prioritize health and safety matters for our employees and customers, cause us to reduce, delay, alter or abandon initiatives that may otherwise increase our long-term value, increase vulnerability to information technology or cybersecurity related risks as certain of our employees work remotely and otherwise continue to disrupt our business operations. For example, we have and expect to continue to incur additional costs and investments in supplies necessary to keep our employees and customers safe, such as face masks, hand sanitizer and cleaning supplies. We expect to encounter labor inefficiencies as we adjust to new operating models to adapt to operating during the pandemic while experiencing what we believe will be an increase in sales activity from 2021. Those labor inefficiencies may include difficulty in hiring employees if enhanced unemployment benefits are signed into law. As our employees return to more normalized store hours, there will also be increased risks to the health and safety of our employees and customers, particularly if there were to be one or more clusters of COVID-19 cases occurring at any of our stores or our corporate headquarters. We may also be subject to enhanced legal risks, including potential litigation related to the COVID-19 pandemic.

The overall magnitude of the COVID-19 pandemic, including the extent of its direct and indirect impact on our business, financial position, results of operations or liquidity is inherently uncertain due to the fluidity of the situation. Further, the ultimate impact of the COVID-19 pandemic depends on many factors that are not within our control, including, but not limited to: governmental, business and individuals' actions that have been and continue to be taken in response to the COVID-19 pandemic; the severity and duration of outbreaks of the virus; the effectiveness of vaccines; the impact of the COVID-19 pandemic and actions taken in response on global and regional economies, travel, and economic activity; the availability of federal, state, local or non-U.S. funding programs; general economic uncertainty in key global markets and financial market volatility; global economic conditions and levels of economic growth; and the pace of recovery, particularly in our markets, when the COVID-19 pandemic subsides.

We are unable to estimate the impact of the COVID-19 pandemic with certainty on our business and operations at this time. The pandemic could cause us to experience impairment of our goodwill and other financial assets, further reduce demand for our products and services and other adverse impacts on our financial position, results of operations and cash flows. Sustained adverse effects may also prevent us from satisfying financial covenants in our credit agreement, which would prevent us from paying dividends, or result in downgrades in our credit ratings.

Monro, Inc. 2021 Form 10-K 10

We operate in the highly competitive automotive repair industry.

The automotive repair industry in which we operate is generally highly competitive and fragmented, and the number, size and strength of our competitors vary widely from region to region. We believe that competition in the industry is based primarily on customer service, reputation, store location, name awareness and price. Our primary competitors include national and regional undercar, tire specialty and general automotive service chains, both franchised and company-operated, car dealerships, mass merchandisers operating service centers and, to a lesser extent, gas stations, independent garages and Internet tire sellers. Some of our competitors have greater financial resources, are more geographically diverse and have better name recognition than we do, which might place us at a competitive disadvantage to those competitors. Because we seek to offer competitive prices, if our competitors reduce prices, we may be forced to reduce our prices, which could have a material adverse effect on our business, financial condition and results of operations. Further, our success within this industry also depends upon our ability to respond in a timely manner to changes in customer demands for both products and services. We cannot assure that we, or any of our stores, will be able to compete effectively. If we are unable to compete successfully in new and existing markets, we may not achieve our projected revenue and profitability targets.

We are subject to cycles in the general economy and customers’ use of vehicles and seasonality, which may impact demand for our products and services.

Our industry is influenced by the number of miles driven by automobile owners. Factors that may cause the number of miles driven by automobile owners to decrease include the weather, travel patterns, gas prices and fluctuations in the general economy. For example, as a result of the COVID-19 pandemic, there has been a marked decrease in the number of miles driven by automobile owners due to the various stay-at-home orders across the regions in which we operate. As a result of this reduction in the number of miles driven by automobile owners, there has been a negative effect on the demand for our products and services. As another example, when the retail cost of gasoline increases, the number of miles driven by automobile owners may decrease, which could result in less frequent service intervals and fewer repairs. The number of vehicle miles driven may also decrease if consumers begin to rely more heavily on mass transportation.

Sales can decline in areas in which we operate as a result of warmer weather in winter months or severe weather, which can result in store closures. Although our business is not highly seasonal, our customers typically purchase more undercar services during the period of March through October than the period of November through February, when miles driven tend to be lower. Further, customers may defer or forego vehicle maintenance at any time during periods of inclement weather. Sales of tires are more heavily weighted in the months of May through August, and October through December. The slowest months are typically January through April and September. As a result, profitability is typically lower during slower sales months or months where mix is more heavily weighted toward tires, which is a lower margin category.

Any continued significant reduction in the number of miles driven by automobile owners will have a material adverse effect on our business and results of operations.

Our business is affected by advances in automotive technology.

The demand for our products and services could be adversely affected by continuing developments in automotive technology. Automotive manufacturers are producing cars that last longer and require service and maintenance at less frequent intervals in certain cases. Quality improvement of manufacturers’ original equipment parts has in the past reduced, and may in the future reduce, demand for our products and services, adversely affecting our sales. For example, manufacturers’ use of stainless steel exhaust components has significantly increased the life of those parts, thereby decreasing the demand for exhaust repairs and replacements. Longer and more comprehensive warranty or service programs offered by automobile manufacturers and other third parties also could adversely affect the demand for our products and services. We believe that a majority of new automobile owners have their cars serviced by a dealer during the period that the car is under warranty.

Advances in electric vehicle technology and production may adversely affect the demand for our services because electric vehicles do not have traditional engines, transmissions, and certain related parts. An increase in the proportion of electric vehicles sold could decrease our service-related revenue. In addition, advances in automotive technology continue to require us to incur additional costs to update our diagnostic capabilities and technical training programs. Changes in vehicle and powertrain technology and advances in accident avoidance technology, electric vehicles, autonomous vehicles and mobility could have a negative effect on our business, results of operations or investors’ perception of our business, any of which could have an adverse effect upon the price of our common stock.

Monro, Inc. 2021 Form 10-K 11

Changes in economic conditions that impact consumer spending could harm our business.

The automotive repair industry and our financial performance are sensitive to changes in overall economic conditions that impact consumer spending, including the economic volatility resulting from the COVID-19 pandemic. Future economic conditions affecting consumer income such as employment levels, business conditions, interest rates, inflation and tax rates could reduce consumer spending or cause consumers to shift their spending to other products. During periods of good economic conditions, consumers may decide to purchase new vehicles rather than servicing their older vehicles. In addition, if automobile manufacturers offer lower pricing on new or leased cars, more consumers may purchase or lease new vehicles rather than servicing older vehicles. A general reduction in the level of consumer spending or shifts in consumer spending to other services could have a material adverse effect on our growth, sales and profitability.

Changes in the U.S. trade environment, including the imposition of import tariffs, could adversely affect our consolidated results of operations and cash flows.

In recent years, trade tensions between the U.S. government and China have increased as the U.S. government has implemented and proposed tariffs and the Chinese government proposed retaliatory tariffs. Although we have no foreign operations and do not manufacture any products, tariffs imposed on products that we sell, such as tires, may cause our expenses to increase, which could adversely affect our profitability unless we are able to raise our prices for these products. If we increase the price of products impacted by tariffs, our service offerings may become less attractive relative to services offered by our competitors or cause our customers to delay needed maintenance. Given the uncertainty regarding the scope and duration of these trade actions by the U.S. or other countries, the impact of these trade actions on our operations or results remains uncertain. However, the tariffs, along with any additional tariffs or retaliatory trade restrictions implemented by other countries, could adversely affect the operating profits of our business, which could have an adverse effect on our consolidated results of operations and cash flows.

We depend on our relationships with our vendors, including foreign sources, for certain inventory. Our business may be negatively affected by the risks associated with such relationships and international trade.

We depend on close relationships with our vendors for parts, tires and supplies and for our ability to purchase products at competitive prices and terms. Our ability to purchase at competitive prices and terms results from the volume of our purchases from these vendors. We have entered into various contracts with parts suppliers that require us to buy from them (at market competitive prices) up to 100 percent of our annual purchases of specific products. These agreements expire at various dates.

We believe that alternative sources exist for most of the products we sell or use at our stores, and we would not expect the loss of any one supplier to have a material adverse effect on our business, financial condition or results of operations. If any of our suppliers do not perform adequately or otherwise fail to distribute parts or other supplies to our stores, our inability to replace the suppliers in a timely manner and on acceptable terms could increase our costs and could cause shortages or interruptions that could have a material adverse effect on our business, financial condition and results of operations.

Because we purchase products such as oil and tires, which are subject to cost variations related to commodity costs, if we cannot pass along cost increases, our profitability would be negatively impacted.

In addition, we depend on a number of products (e.g. brake parts, tires, oil filters) produced in foreign markets. Any changes in U.S. trade policies, or uncertainty with respect to the future of U.S. trade policies, resulting in increased costs which we are not able to offset with pricing increases of our own could adversely affect our financial performance.

We also face other risks associated with the delivery of inventory originating outside the United States, including:

potential economic and political instability in countries where our suppliers are located;

increases in shipping costs;

transportation delays and interruptions, including those occurring as a result of the COVID-19 pandemic;

compliance with the United States Foreign Corrupt Practices Act, which generally prohibits U.S. companies from engaging in bribery or making other prohibited payments to foreign officials; and

significant fluctuations in exchange rates between the U.S. dollar and foreign currencies.

Monro, Inc. 2021 Form 10-K 12

If we are unable to generate sufficient cash flows from our operations, our liquidity will suffer and we may be unable to satisfy our obligations.

We currently rely on cash flow from operations and our $600 million revolving credit facility with eight banks (the “Credit Facility”) to fund our business. Amounts outstanding on the Credit Facility are reported as debt on our balance sheet. While we believe that we have the ability to sufficiently fund our planned operations and capital expenditures for the foreseeable future, various risks to our business could result in circumstances that would materially affect our liquidity. For example, cash flows from our operations could be affected by changes in consumer spending habits, the failure to maintain favorable vendor payment terms or our inability to successfully implement sales growth initiatives, among other factors. We may be unsuccessful in securing alternative financing when needed on terms that we consider acceptable.

On March 27, 2020, we borrowed $350 million available under the Credit Facility in order to enhance liquidity and financial flexibility given the uncertain market conditions caused by the COVID-19 pandemic. We subsequently repaid the $350 million previously borrowed during 2021 and there is $190.0 million outstanding under the Credit Facility as of March 27, 2021. A significant increase in our leverage could have the following risks:

our ability to obtain additional financing for working capital, capital expenditures, store renovations, acquisitions or general corporate purposes may be impaired in the future;

our failure to comply with the financial and other restrictive covenants governing our debt, which, among other things, require us to comply with certain financial ratios and limit our ability to incur additional debt and sell assets, could result in an event of default that, if not cured or waived, could have a material adverse effect on our business, financial condition and results of operations; and

our exposure to certain financial market risks, including fluctuations in interest rates associated with bank borrowings could become more significant.

Although we believe that we will remain in compliance with our debt covenants, if we are not able to do so our lenders may restrict our ability to draw on our Credit Facility, which could have a negative impact on our operations, ability to pay dividends, and growth potential, including our ability to complete acquisitions.

Legal, Regulatory and Technological Risks

Our industry is subject to environmental, consumer protection and other regulation.

We are subject to various federal, state and local environmental laws, building and zoning requirements, employment and labor laws and other governmental regulations regarding the operation of our business. For example, we are subject to rules governing the handling, storage and disposal of hazardous substances contained in some of the products such as motor oil that we sell and use at our stores, the recycling of batteries, tires and used lubricants, and the ownership and operation of real property. These laws and regulations can impose fines and criminal sanctions for violations as well as require the installation of pollution control equipment or operational changes to decrease the likelihood of accidental hazardous substance releases. Accordingly, we could become subject to material liabilities relating to the investigation and cleanup of contaminated properties, and to claims alleging personal injury or property damage as a result of exposure to, or release of, hazardous substances. In addition, stricter interpretation of existing laws and regulations, new laws and regulations, the discovery of previously unknown contamination or the imposition of new or increased requirements could require us to incur costs or become the basis of new or increased liabilities that could have a material adverse effect on our business, financial condition and results of operations.

National automotive repair chains have also been the subject of investigations and reports by consumer protection agencies and the Attorneys General of various states. Publicity in connection with these kinds of investigations could have an adverse effect on our sales and, consequently, our business, financial condition and results of operations. State and local governments have also enacted numerous consumer protection laws with which we must comply.

The costs of operating our stores may increase if there are changes in laws governing minimum hourly wages, working conditions, overtime, workers’ compensation and health insurance rates, unemployment tax rates or other laws and regulations. We have experienced and expect further increases in payroll expenses as a result of federal, state and local mandated increases in the minimum wage. In addition, our vendors may be affected by higher minimum wage standards, which may increase the prices we pay for their products. A material increase in these costs that we were unable to offset by increasing our prices or by other means could have a material adverse effect on our business, financial condition and results of operations.

Monro, Inc. 2021 Form 10-K 13

We are involved in litigation from time to time arising from the operation of our business and, as such, we could incur substantial judgments, fines, legal fees or other costs.

We are sometimes the subject of complaints or litigation from customers, employees or other third parties for various actions. From time to time, we are involved in litigation involving claims related to, among other things, breach of contract, negligence, tortious conduct and employment and labor law matters, including payment of wages. We may also face claims related to the COVID-19 pandemic, including claims from employees or customers who contract COVID-19 at our stores or offices. The damages sought against us in some of these litigation proceedings could be substantial.

As disclosed in Part I, Item 3, “Legal Proceedings,” an action has been brought against us by an individual seeking to represent a putative class of store managers for unpaid overtime wages, damages and attorneys’ fees under the Fair Labor Standards Act and class certification under Pennsylvania law for alleged violations of state wage payment laws. Plaintiff alleges that improper deductions were made from store managers’ pay. If we settle these claims or the action is not resolved in our favor, we may suffer reputational damage and incur legal costs, settlements or judgments that exceed the amounts covered by our existing insurance policies. We can provide no assurances that our insurer will insure the legal costs, settlements or judgements we incur in excess of our deductible. If we are unsuccessful in defending ourselves from these claims or if our insurer does not insure us against legal costs we incur in excess of our deductible, the result may materially adversely affect our business, results of operations and financial condition.

Although we maintain liability insurance for some litigation claims, if one or more of the claims were to greatly exceed our insurance coverage limits or if our insurance policies do not cover a claim, this could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Business interruptions may negatively impact our store operations, availability of products and/or the operability of our computer systems, which may have a material negative effect on our business and results of operations. A breach of our computer systems could damage our reputation and have a material adverse effect on our business and results of operations.

If any of our locations in a particular region are unexpectedly closed permanently or for a period of time, it could have a negative impact on our business. Such closures could occur as a result of circumstances out of our control, including war, acts of terrorism, global health crises, extreme weather conditions and other natural disasters. Further, if our ability to obtain products and merchandise for use in our stores is impeded, it could have a negative impact on our business. Factors that could negatively affect our ability to obtain products and merchandise include the sudden inability to import goods into the United States for any reason and the curtailment or delay of commercial transportation. While we do maintain business interruption insurance, there is no guarantee that we will be able to use such insurance for any particular location closure or other interruption in operations.

Additionally, given the number of individual transactions we process each year, it is critical that we maintain uninterrupted operation of our computer and communications hardware and software systems. Our systems could be subject to damage or interruption from power outages, computer and telecommunications failures, computer viruses, security breaches, including breaches of our transaction processing or other systems that result in the compromise of confidential customer data, catastrophic events such as fires, tornadoes and hurricanes, and usage errors by our employees. If our systems are breached, damaged or cease to function properly, we may have to make a significant investment to fix or replace them, we may suffer interruptions in our operations in the interim, we may face costly litigation, and our reputation with our customers may be harmed. The risk of disruption is increased in periods where complex and significant systems changes are undertaken. Any material interruption in our computer operations may have a material adverse effect on our business or results of operations.

If we experience a data security breach and confidential customer or employee information is disclosed, we may be subject to penalties and experience negative publicity, which could affect our customer relationships and have a material adverse effect on our business. We may incur increasing costs in an effort to minimize these cyber security risks.

The nature of our business involves the receipt and storage of personally identifiable data of our customers and employees. This type of data is subject to legislation and regulation in various jurisdictions. We have been subject to cyber-attacks in the past and we may suffer data security breaches arising from future attacks. We may currently be at a higher risk of a security breach due to the COVID-19 pandemic and the increased number of our employees who are working remotely. Data security breaches suffered by well-known companies and institutions have attracted a substantial amount of media attention, prompting state and federal legislative proposals addressing data privacy and security. We may become exposed to potential liabilities with respect to the data that we collect, manage and process, and may incur legal costs if our information security policies and procedures are not effective or if we are required to defend our methods of collection, processing and storage of personal data. Future investigations, lawsuits or adverse publicity relating to our methods of handling personal data could adversely affect our business, results of operations, financial condition and cash flows due to the costs and negative market reaction relating to such developments.

Monro, Inc. 2021 Form 10-K 14

We may not have the resources or technical expertise to anticipate or prevent rapidly evolving types of cyber-attacks. Attacks have been targeted at us, our customers, or others who have entrusted us with information. Actual or anticipated attacks will cause us to incur increased costs, including costs to hire additional personnel, purchase additional protection technologies, train employees, and engage third-party experts and consultants. In addition, data and security breaches can also occur as a result of non-technical issues, including breach by us or by persons with whom we have commercial relationships that result in the unauthorized release of personal or confidential information. Any compromise or breach of our security could result in violation of applicable privacy and other laws, significant legal and financial exposure, and a loss of confidence in our security measures, which could have a material adverse effect on our results of operations and our reputation.

Risks Related to our Strategic Initiatives

We may not be successful in integrating new and acquired stores.

Management believes that our continued growth in sales and profit is dependent, in large part, upon our ability to operate new stores that we open or acquire on a profitable basis. In order to do so, we must find reasonably priced new store locations and acquisition candidates that meet our criteria and we must integrate any new stores (opened or acquired) into our system. Our growth and profitability could be adversely affected if we are unable to open or acquire new stores or if new or existing stores do not operate at a sufficient level of profitability. In addition, our profitability could be adversely affected if we fail to retain key personnel from acquired stores or assume unanticipated liabilities of acquired businesses. To the extent we acquire stores or expand into new geographic regions, we must anticipate the needs of customers and the vehicle population in those regions, which may differ from our existing customers and the vehicle populations we serve, while integrating the stores in the new geographic region into our existing network of stores. If new stores do not achieve expected levels of profitability or we are unable to integrate stores in new geographic regions into our business, our ability to remain in compliance with our debt covenants or to make required payments under our credit facility may be adversely impacted.

If our capital investments in remodeling existing or acquired stores, building new stores, and improving technology do not achieve appropriate returns, our competitive position, financial condition and results of operations could be adversely affected.

Our business depends, in part, on our ability to remodel existing or acquired stores and build new stores in a manner that achieves appropriate returns on our capital investment. Pursuing the wrong remodel or new store opportunities and any delays, cost increases, disruptions or other uncertainties related to those opportunities could adversely affect our results of operations.

We are currently making, and expect to continue to make, significant investments in technology to improve customer experience and certain management systems. The effectiveness of these investments can be less predictable than remodeling stores, and might not provide the anticipated benefits or desired rates of return.

Pursuing the wrong investment opportunities, making an investment commitment significantly above or below our needs, or failing to effectively incorporate acquired businesses into our business could result in the loss of our competitive position and adversely affect our financial condition or results of operations.

Any impairment of goodwill, other intangible assets or long-lived assets could negatively impact our results of operations.

Our goodwill is subject to an impairment test on an annual basis. Goodwill, other intangible assets and long-lived assets are also tested whenever events and circumstances indicate that goodwill, other intangible assets and/or long-lived assets may be impaired. Any excess goodwill resulting from the impairment test must be written off in the period of determination. Intangible assets (other than goodwill and indefinite-lived intangible assets) and other long-lived assets are generally amortized or depreciated over the useful life of such assets. In addition, from time to time, we may acquire or make an investment in a business that will require us to record goodwill based on the purchase price and the value of the acquired tangible and intangible assets. We have significantly increased our goodwill as a result of our acquisitions. We may subsequently experience unforeseen issues with the businesses we acquire, which may adversely affect the anticipated returns of the business or value of the intangible assets and trigger an evaluation of recoverability of the recorded goodwill and intangible assets. Future determinations of significant write-offs of goodwill, intangible assets or other long-lived assets, as a result of an impairment test or any accelerated amortization or depreciation of other intangible assets or other long-lived assets, including those caused by the impact of the COVID-19 pandemic, could have a material negative impact on our results of operations and financial condition. 

Planned store closings have resulted in acceleration of costs and future store closings could result in additional costs.

From time to time, in the ordinary course of our business, we close certain stores, generally based on considerations of store profitability, competition, strategic factors and other considerations. The economic impact of the COVID-19 pandemic may require us

Monro, Inc. 2021 Form 10-K 15

to close certain stores either temporarily or permanently. Closing a store could subject us to costs including the write-down of leasehold improvements, equipment, furniture and fixtures. In addition, we could remain liable for future lease obligations.

General Risk Factors

We may not pay or may reduce the dividends on our common stock.

Holders of our common stock are only entitled to receive such dividends as our Board of Directors may declare out of funds legally available for such payments. Although we have historically declared cash dividends on our common stock, we are not required to do so and may reduce or eliminate our common stock dividend in the future. This could adversely affect the market price of our common stock.

We rely on an adequate supply of skilled field personnel.

In order to continue to provide high quality services, we require an adequate supply of skilled field managers and technicians. Trained and experienced automotive field personnel are in high demand, and may be in short supply in some areas. We cannot assure that we will be able to attract, motivate and maintain an adequate skilled workforce necessary to operate our existing and future stores efficiently, or that labor expenses will not increase as a result of a shortage in the supply of skilled field personnel, thereby adversely impacting our financial performance. While the automotive repair industry generally operates with high field employee turnover, any material increases in employee turnover rates in our stores, inability to recruit new employees or any widespread employee dissatisfaction could also have a material adverse effect on our business, financial condition and results of operations.

We depend on the services of our key executives.

Our senior executives are important to our success because they have been instrumental in setting our strategic direction, operating our business, identifying, recruiting and training key personnel, identifying expansion opportunities and arranging necessary financing. Losing the services of any of these individuals could adversely affect our business until a suitable replacement is found. It may be difficult to replace them quickly with executives of comparable experience and capabilities. Although we have employment agreements with certain of our executives, we cannot prevent them from terminating their employment with us. To the extent we have turnover within our management team, we may have to spend more time and resources training new members of management and integrating them in our company. The loss of service of any one of our key executives would likely cause a disruption in our business plans and may adversely impact our results of operations.

We have had significant changes in executive leadership, and more changes could occur. Changes to strategic or operating goals, which can occur with the appointment of new executives, can create uncertainty, and may ultimately be unsuccessful. In addition, executive leadership transition periods, including adding new personnel, could be difficult as new executives gain an understanding of our business and strategy. Difficulty integrating new executives, or the loss of key individuals could limit our ability to successfully execute our business strategy and could have an adverse effect on our overall financial condition.

The market price of our common stock may be volatile and could expose us to shareholder action including securities class action litigation.

The stock market and the price of our common stock may be subject to wide fluctuations based upon general economic and market conditions. Downturns in the stock market may cause the price of our common stock to decline. The market price of our stock may also be affected by our ability to meet analysts’ expectations. Failure to meet such expectations, even slightly, could have an adverse effect on the price of our common stock. In the past, following periods of volatility in the market price of a company’s securities, shareholder action including securities class action litigation has often been instituted against such a company. If similar litigation were instituted against us, it could result in substantial costs and a diversion of our management’s attention and resources, which could have an adverse effect on our business.

Item 1B. Unresolved Staff Comments

None.

Monro, Inc. 2021 Form 10-K 16

Item 2. Properties

Company-operated Stores as of March 27, 2021	Stores	Company-operated Stores as of March 27, 2021	Stores
Arkansas	2	Minnesota	9
California	68	Missouri	26
Connecticut	36	Nevada	14
Delaware	6	New Hampshire	29
Florida	107	New Jersey	44
Georgia	13	New York	145
Idaho	4	North Carolina	56
Illinois	33	Ohio	142
Indiana	39	Pennsylvania	130
Iowa	3	Rhode Island	11
Kentucky	33	South Carolina	18
Louisiana	17	Tennessee	17
Maine	18	Vermont	7
Maryland	70	Virginia	70
Massachusetts	40	West Virginia	10
Michigan	31	Wisconsin	15
		Total	1,263

Company-operated Stores and Other Properties as of March 27, 2021		Distribution	Retread
	Stores	Centers	Facilities
Owned	329	2	1
Leased	871	9	2
Owned buildings on leased land	63	—	—
Total	1,263	11	3

Our policy is to situate new Company-operated stores in the best locations, without regard to the form of ownership required to develop the locations. In general, we lease store sites for a ten-year period with several renewal options (up to ten years). Giving effect to all renewal options, approximately 63 percent of the leases (587 stores) expire after March 2031. Certain leases provide for contingent rental payments if a percentage of annual gross sales exceed the base fixed rental amount. The highest contingent percentage rent of any lease is 7.5 percent, and no such lease has adversely affected profitability of the store subject thereto.

Our seven wholesale locations are situated within distribution centers that are leased.

We own our corporate headquarters building located in Rochester, New York, and we lease and own additional office space elsewhere in the U.S.

Item 3. Legal Proceedings

From time to time we are a party to or otherwise involved in legal proceedings arising out of the normal course of business. Legal matters are subject to inherent uncertainties and there exists the possibility that the ultimate resolution of one or more of these matters could have a material adverse impact on the Company, its financial condition and results of operations.

On June 12, 2020, former service store manager Mark Cerini filed suit in the U.S. District Court for the Western District of Pennsylvania.  The Plaintiff is seeking nationwide collective action certification to represent similarly-situated store managers for unpaid overtime wages, damages and attorneys’ fees under the Fair Labor Standards Act and class certification under Pennsylvania law for alleged violations of state wage payment laws. Plaintiff alleges that improper deductions were made from store managers’ pay.  We dispute and believe we have meritorious defenses against these claims and plan to vigorously defend ourselves.

Item 4. Mine Safety Disclosures

Not applicable.

‎

Monro, Inc. 2021 Form 10-K 17

PART II

Item 5. Market for the Company's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Monro’s common stock, par value $.01 per share, (the “Common Stock”) is traded on the Nasdaq Stock Market under the symbol "MNRO".

Holders of Record

At May 14, 2021, Monro’s Common Stock was held by approximately 43 shareholders of record. This figure does not include an estimate of the indeterminate number of beneficial holders whose shares may be held of record by brokerage firms and clearing agencies.

Dividends

The declaration of and determination as to the payment of future dividends will be at the discretion of the Board of Directors and will depend on our financial condition, results of operations, capital requirements, compliance with charter and contractual restrictions, and such other factors as the Board of Directors deems relevant. We currently expect that comparable cash dividends will continue to be paid in the future. Under our Credit Facility, we may declare, make or pay any dividend or distribution up to $38.5 million in the aggregate for the period from June 30, 2020 to June 30, 2021 if we are in compliance with the financial covenants and other restrictions in the Credit Facility, as amended. For additional information regarding our Credit Facility, see Note 7 to the Company’s consolidated financial statements.

	Fiscal Years Ended March
		2016		2017		2018		2019		2020		2021
Monro, Inc.	$	100.00	$	73.76	$	76.97	$	125.70	$	64.51	$	98.46
S&P Industrials Index		100.00		118.38		134.89		139.25		112.14		190.20
S&P Specialty Stores Index		100.00		98.60		85.19		124.31		99.97		162.33

The graph above compares the cumulative total shareholder return on our common stock for the last five fiscal years ended March with (1) the cumulative return on the S&P Industrials Index and (2) the cumulative return on the S&P Specialty Stores Index. The graph assumes the investment of $100 in Monro common stock, the S&P Industrials Index and the S&P Specialty Stores Index, and reinvestment of all dividends.

Item 6. Selected Financial Data

Not applicable.

Monro, Inc. 2021 Form 10-K 18

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

Executive Overview

While our business was materially affected by the COVID-19 pandemic, resulting in significantly lower sales and profits in 2021, we continued to make strategic investments to support our operating and financial model designed to drive sustainable sales and profit growth. We have done this through our Monro.Forward investment strategy focused on the following four key pillars:

Improve Guest Experience

We transformed 147 stores through rebranding and reimaging investments during 2021.

We made significant investments in the health and safety of our teammates and guests.

Enhance Customer-Centric Engagement

We completed the installation of our store digital phone and customer communication system in 2021.

We realigned our marketing spend toward higher return-on-investment (“ROI”) digital channel during 2021.

Optimizing Product and Service Offering

We completed the rollout of our tire pricing and category management technology in 2021.

Accelerating Productivity and Team Engagement

We completed the rollout of our technology-based labor model, with data-driven cloud based store staffing and scheduling software, during 2021.

We leveraged Monro University to facilitate onboarding and training required of new teammates in order to reach full productivity.

Growth through Acquisitions

In addition to our Monro.Forward investment strategy, executing on strategically located acquisitions with attractive valuations remains a key element of our growth strategy in support of our operating and financial model. We are committed to executing on attractive opportunities in our highly fragmented industry and are actively evaluating acquisition targets. We have continued to capitalize on a robust acquisition pipeline as we acquired 17 stores in 2021 and, subsequent to March 27, 2021, we completed the acquisition of 30 stores on April 25, 2021.

Financial Summary

2021 included the following notable items:

Diluted earnings per common share (“EPS”) were $1.01.

Adjusted diluted EPS, a non-GAAP measure, were $1.14.

Sales decreased 10.4 percent, driven by a decrease in comparable store sales.

Comparable store sales decreased 11.1 percent, driven primarily by a decline in guest traffic, partially offset by an increase in average ticket amount spent.

Operating income of $72.2 million was 29.0 percent lower than the prior year.

Net income was $34.3 million.

Adjusted net income, a non-GAAP measure, was $38.7 million.

Operating cash flow of $184.9 million was 52.3 percent higher than the prior year.

Earnings Per Common Share					Percent Change
		2021		2020	2021/2020
Diluted EPS	$	1.01	$	1.71	(40.9)	%
Adjustments		0.12		0.29
Adjusted diluted EPS	$	1.14	$	2.00	(43.0)	%

Note: Amounts may not foot due to rounding.

Monro, Inc. 2021 Form 10-K 19

Adjusted diluted EPS and adjusted net income, each of which are a measure not derived in accordance with generally accepted accounting principles in the U.S. (“GAAP”), exclude the impact of certain items. Management believes that adjusted diluted EPS and adjusted net income are useful in providing period-to-period comparisons of the results of our operations by excluding certain non-recurring items and items related to our Monro.Forward or acquisition initiatives. Reconciliations of these non-GAAP financial measures to GAAP measures are provided beginning on page 24 under “Non-GAAP Financial Measures.”

We define comparable store sales, or same store sales, as sales for stores that have been opened or owned at least one full fiscal year. We believe this period is generally required for new store sales levels to begin to normalize. Management uses comparable store sales to assess the operating performance of the Company’s stores and believes the metric is useful to investors because our overall results are dependent upon the results of our stores.

Recent Development and Trends

Our Company-operated stores have experienced improvement in sales to date from the low point during April 2020. The following table presents fiscal monthly information about our recent comparable store sales trends. There is no assurance that these trends will continue.

Comparable Store Sales	2021												2022
(Year-over-Year)	Apr.	May	Jun.	Jul.	Aug.	Sep.	Oct.	Nov.	Dec.	Jan.	Feb.	Mar.	Apr.
Increase/(decrease)	(41)%	(24)%	(14)%	(12)%	(13)%	(8)%	(12)%	(18)%	(6)%	3%	(2)%	32%	76%

As we move through this transition and anticipate comparable store sales trends to improve, we expect to incur some labor inefficiencies as we adjust to new operating models and federal and local health and safety protocols with a goal to remain as efficient as possible while still offering safe and high quality service to our guests. Those labor inefficiencies may include difficulty in hiring employees required to maintain store staffing levels needed to meet demand. We will also incur additional costs and investments in supplies necessary to keep our teams and guests safe, such as face masks, hand sanitizer and cleaning supplies, which are all expected to be ongoing costs for the duration of the COVID-19 pandemic and recovery period.

Given the level of volatility and uncertainty surrounding the future impact of COVID-19, we cannot estimate with certainty the long-term impacts of COVID-19 on our business, financial condition, results of operations, or cash flows in the future. Please see the risks set forth in Part I, Item 1A. “Risk Factors” above for further discussion of the risks that may impact our longer-term operational and financial performance.

Impact of COVID-19

In response to the unprecedented and rapid spread of COVID-19, many U.S. state governments, in states in which we operate, enacted stay-at-home restrictions and social distancing measures during fiscal 2021. State and local governments ordered restrictions on the operations of certain businesses, including temporary closures of some businesses, and numerous other businesses temporarily closed voluntarily or transitioned their workforces to working remotely. Further, individuals’ ability to travel was curtailed through mandated travel restrictions throughout the year.

As a result, demand for automotive undercar repair services as well as replacement tires and tire related services declined at a rapid pace and has remained below normal levels, which has had an unprecedented and materially adverse impact on our results of operations and business operations. Although demand improved in 2021 from the low point during April 2020, we experienced a significant decline in guest traffic throughout the year, as compared to the prior year, which we believe is due to the COVID-19 pandemic. During 2021, comparable store sales decreased 11.1 percent from the prior year. As an essential business, our stores and distribution centers remained open during the pandemic, however, substantially all Company-operated retail stores operated under a reduced schedule throughout the year to match lower demand. We continue to address the ongoing business challenges and shifting economic dynamics as the COVID-19 pandemic and recovery efforts have continued to evolve.

Despite the challenges, some positive signs have begun to emerge. Since the low point during April 2020, we have experienced improvement in sales driven by improvement in store traffic. However, there can be no assurance as to the time required to fully recover operations and sales to pre-pandemic levels or if we will reach those levels again.

Liquidity

Given the uncertainties surrounding the impacts of the COVID-19 pandemic on our future financial condition, results of operations and cash flows, we have taken a number of actions in response to prevailing uncertain market conditions. In order to enhance our

Monro, Inc. 2021 Form 10-K 20

liquidity position, we took a precautionary measure and borrowed $350 million available to us under our credit facility in March 2020. We subsequently repaid the $350 million previously borrowed during 2021. To improve our liquidity, we took the following measures during 2021 to reduce costs and improve cash flows: (i) reduced store hours and store labor to align with reduced demand across our store locations; (ii) undertook significant reductions in operating expenses across the Company, including compensation expense through the continued furlough of or other reduction to certain members of our workforce as well as advertising expense through realigned marketing spend toward digital channels; and (iii) negotiated rent deferrals for a significant number of our stores, as well as other rent reductions. Although acquisition activity was paused during the first six months of fiscal 2021, we continued to evaluate potential acquisition candidates that we believe would fit our growth strategy while maintaining financial discipline. We acquired 17 retail tire and automotive repair stores located in California in December 2020 and financed the acquisition through our Credit Facility. Additionally, with sales improvement throughout 2021, we resumed our rebrand and reimage initiatives and have substantially completed the transformation of 147 stores during the year, after pausing these initiatives during the first three months of fiscal 2021.

Enhanced Safety Standards

As the COVID-19 pandemic has continued to evolve, our priority has been and continues to be, the health and safety of our teammates and guests. To protect our teammates and guests, we have implemented strict cleaning and sanitation measures. In addition, we have provided face masks and other protective equipment, including sneeze guards installed at each sales counter, necessary to ensure the safety of our teammates and guests. We have also implemented various measures intended to reduce the spread of COVID-19 among our non-store workforce including working from home and encouraging teammates to adhere to prevention measures recommended by the Centers for Disease Control and the World Health Organization. Since our non-store workforce is able to work remotely using various technology tools, we are able to maintain our operations and internal controls over financial reporting and disclosures.

Analysis of Results of Operations

Summary of Operating Income					Percent Change
(thousands)		2021		2020	2021/2020
Sales	$	1,125,721	$	1,256,524	(10.4)	%
Cost of sales, including distribution and occupancy costs		730,526		779,866	(6.3)
Gross profit		395,195		476,658	(17.1)
Operating, selling, general and administrative expenses		322,957		374,956	(13.9)
Operating income	$	72,238	$	101,702	(29.0)	%

We have elected to omit discussion on the earliest of the three years covered by the consolidated financial statements presented. The discussion of the fiscal year ended March 30, 2019 is incorporated herein by reference to Part II, Item 7., “Management’s Discussion and Analysis of Financial Condition and Results of Operations” located in our Form 10-K for the fiscal year ended March 28, 2020, filed on June 12, 2020. 

Sales

Sales include automotive undercar repair, tire replacement and tire related service sales, net of discounts, returns, etc., and revenue from the sale of warranty agreements and commissions earned from the delivery of tires. See Note 8 to the Company’s consolidated financial statements for further information. We use comparable store sales to evaluate the performance of our existing stores by measuring the change in sales for a period over the comparable, prior-year period of equivalent length. There were 361 selling days in both 2021 and 2020. Comparable sales measures vary across the retail industry. As a result, our comparable sales calculation is not necessarily comparable to similarly titled measures reported by other companies.

Sales growth – from both comparable store sales and new stores – represents an important driver of our long-term profitability. We expect that comparable store sales growth will significantly impact our total sales growth. We believe that our ability to successfully differentiate our guests’ experience through a careful combination of merchandise assortment, price, convenience, guest experience, and other factors will over the long-term drive both increasing guest traffic and the average ticket amount spent.

Sales
(thousands)		2021			2020
Sales	$	1,125,721		$	1,256,524
Dollar change compared to prior year	$	(130,803)
Percentage change compared to prior year		(10.4)	%

Monro, Inc. 2021 Form 10-K 21

The sales decrease was primarily due to a decrease in comparable store sales from a substantial decrease in traffic as a result of the COVID-19 pandemic, partially offset by new store sales. Additionally, there was a decrease in sales from closed stores. The following table shows the drivers of the change in sales between 2020 and 2021.

Sales Percentage Change	2021
Sales change	(10.4)	%
Primary drivers of change in sales
Comparable stores sales	(11.1)	%
New store sales (a)	2.3	%
Closed store sales	(1.8)	%

(a)Sales from 2021 and 2020 acquisitions represented 2.0 percent of the changes between 2020 and 2021.

As a result of the impact of the unprecedented and rapid spread of COVID-19, demand for automotive undercar repair services as well as replacement tires and tire related services declined at a rapid pace and has remained below normal levels. During 2021, substantially all Company-operated retail stores operated under a reduced schedule for a majority of the year to match lower demand. Although demand improved in 2021 from the low point during April 2020, we experienced a significant decline in guest traffic throughout the year, as compared to the prior year, which we believe is due to the COVID-19 pandemic. Comparable store sales were impacted by lower guest traffic, offset by higher average ticket amount spent.

During 2021, the completed rollout of our tire category management and pricing tool contributed to outperformance in our largest product category, as compared to the prior year, as shown below:

Sales by Product Category	2021		2020
Brakes	11	%	13	%
Exhaust	2		2
Steering	8		8
Tires	55		51
Maintenance	24		26
Total	100	%	100	%

Comparable store front end/shocks and maintenance services category sales for 2021 both decreased by approximately 19 percent from the prior year. Additionally, brakes and alignment category sales decreased by approximately 24 percent and 13 percent, respectively, on a comparable store basis as compared to the prior year. Comparable store tire category sales for 2021 decreased by approximately 3 percent from the prior year.

Change in Number of Stores	2021
Beginning store count	1,283
Opened (a)	22
Closed (b)	(42)
Ending store count	1,263

(a)Includes 17 stores opened related to the 2021 acquisition as well as one store from the 2020 acquisitions that was opened upon completion of store construction.

(b)Includes four stores temporarily closed due to storm damage.

Cost of Sales and Gross Profit

Gross Profit
(thousands)		2021			2020
Gross profit	$	395,195		$	476,658
Percentage of sales		35.1	%		37.9	%
Dollar change compared to prior year	$	(81,463)
Percentage change compared to prior year		(17.1)	%

The decrease in gross profit, as a percentage of sales, was primarily due to an increase in material costs, as a percentage of sales, as a result of a shift in sales mix to tires. However, we expanded our gross profit per tire from the prior year with the completed rollout of

Monro, Inc. 2021 Form 10-K 22

our tire category management and pricing tool. The decrease in gross profit, as a percentage of sales, was also partially due to an increase in distribution and occupancy costs, as a percentage of sales. Although we were able to reduce these largely fixed costs through rent concessions from landlords, we lost leverage on these costs with lower overall comparable store sales. Partially offsetting these increases was a decrease in technician labor costs, which decreased as a percentage of sales, due to improved labor productivity.

Gross Profit as a Percentage of Sales Change	2021
Gross profit change	(2.8)	%
Drivers of change in gross profit as a percentage of sales
Material costs	(2.6)	%
Distribution and occupancy costs	(1.1)	%
Technician labor costs	0.9	%

Operating, Selling, General and Administrative Expenses

Operating, Selling, General and Administrative Expenses
(thousands)		2021			2020
Operating, Selling, General and Administrative Expenses	$	322,957		$	374,956
Percentage of sales		28.7	%		29.8	%
Dollar change compared to prior year	$	(51,999)
Percentage change compared to prior year		(13.9)	%

The decrease of $52.0 million in operating, selling, general and administrative (“OSG&A”) expenses from the prior year is primarily due to decreased expenses from comparable stores mainly as a result of focused cost reduction against lower overall comparable stores sales, including actively managing our store management staffing levels to match demand and realigning marketing spend toward digital channels, as well as a $6.4 million reduction in impairment charge. The decrease in OSG&A expenses from the prior year also reflects lower expenses from 42 closed stores compared to the prior year. Partially offsetting these decreases was an increase in expenses from new stores.

OSG&A Expenses Change
(thousands)		2021
OSG&A expenses change	$	(51,999)
Drivers of change in OSG&A expenses
Reduction from comparable stores	$	(41,634)
Reduction in impairment charge	$	(6,435)
Reduction from closed stores	$	(6,826)
Increase from new stores	$	2,896

Other Performance Factors

Net Interest Expense

Net interest expense of $28.2 million for 2021 remained relatively flat as compared to the prior year, and increased as a percentage of sales from 2.2 percent to 2.5 percent. Weighted average debt outstanding for 2021 increased by approximately $219 million as compared to 2020. This increase is primarily related to an increase in debt outstanding under our Credit Facility that was borrowed in response to the COVID-19 pandemic in late 2020, as well as an increase in finance lease debt recorded in connection with the 2021 and 2020 acquisitions and greenfield expansion, along with renegotiated leases. Partially offsetting these increases was a decrease in the weighted average interest rate of approximately 190 basis points from the prior year due to lower borrowing rates associated with new leases as well as a decrease in Credit Facility borrowing rates.

Provision for Income Taxes

Our 2021 effective income tax rate was 22.3 percent compared to 21.9 percent for 2020, as discrete items, primarily related to employee share-based compensation, resulted in a larger tax rate benefit in the prior year period. The effective tax rate for 2021 reflects an income tax benefit of $0.5 million due to the difference in statutory tax rates from loss years to years in which such net operating losses may be carried back.

Note 9 to the Company’s consolidated financial statements provides additional information.

Monro, Inc. 2021 Form 10-K 23

Non-GAAP Financial Measures

In addition to reporting net income and diluted EPS, which are GAAP measures, this Form 10-K includes adjusted net income and adjusted diluted EPS, which are non-GAAP financial measures. We have included reconciliations to adjusted net income and adjusted diluted EPS from our most directly comparable GAAP measures, net income and diluted EPS, below. Management views these non-GAAP financial measures as indicators to better assess comparability between periods because management believes these non-GAAP financial measures reflect our core business operations while excluding certain non-recurring items and items related to store closings as well as Monro.Forward or acquisition initiatives.

These non-GAAP financial measures are not intended to represent, and should not be considered more meaningful than, or as an alternative to, their most directly comparable GAAP measures. These non-GAAP financial measures may be different from similarly titled non-GAAP financial measures used by other companies.

Adjusted net income is summarized as follows:

Reconciliation of Adjusted Net Income
(thousands)		2021		2020
Net income	$	34,319	$	58,024
Store impairment charge		144		6,579
Store closing costs		2,738		—
Monro.Forward initiative costs		2,243		3,976
Acquisition due diligence and integration costs		260		1,363
Management transition costs		614		—
Litigation reserve		(250)		250
Headquarters expansion costs		—		346
Provision for income taxes on adjustments		(1,351)		(3,023)
Adjusted net income	$	38,717	$	67,515

Adjusted diluted EPS is summarized as follows:

Reconciliation of Adjusted Diluted EPS		2021		2020
Diluted EPS	$	1.01	$	1.71
Store impairment charge (a)		—		0.15
Store closing costs		0.06		—
Monro.Forward initiative costs		0.05		0.09
Acquisition due diligence and integration costs		0.01		0.03
Management transition costs		0.01		—
Litigation reserve		(0.01)		0.01
Headquarters expansion costs		—		0.01
Adjusted diluted EPS	$	1.14	$	2.00

(a)For 2021, store impairment charge is too minor in amount, net of the impact from income taxes, to have an impact on the calculation of adjusted diluted EPS.

Note: The calculation of the impact of non-GAAP adjustments on diluted EPS is performed on each line independently. The table may not add down by +/- $0.01 due to rounding.

The adjustments to diluted EPS reflect adjusted effective tax rates of 23.5 percent and 24.2 percent for 2021 and 2020, respectively. These adjusted effective tax rates exclude the income tax impacts from share-based compensation and differences in statutory tax rates for net operating loss carrybacks. See adjustments from the Reconciliation of Adjusted Net Income table above for pre-tax amounts.

Monro, Inc. 2021 Form 10-K 24

Analysis of Financial Condition

Capital Resources, Contractual Obligations and Liquidity

Capital Resources

Our primary capital requirements for 2021 were divided among the funding of acquisitions for $17.2 million, as well as the upgrading of facilities and systems and the funding of our store transformation program totaling $51.7 million. In 2020, our primary capital requirements were divided among the funding of acquisitions for $104.4 million, as well as the upgrading of facilities and systems and the funding of our store transformation program totaling $55.9 million. In both 2021 and 2020, capital requirements were primarily met by cash flow from operations and from our Credit Facility.

We paid dividends of $29.8 million in 2021. In May 2021, Monro’s Board of Directors declared a cash dividend of $0.24 per share or share equivalent to be paid to shareholders of record as of June 7, 2021. The dividend will be paid on June 21, 2021.

The acquisition subsequent to March 27, 2021 was financed through our existing credit facility. See Note 3 to the Company’s consolidated financial statements.

Through rebranding and reimaging investments, we have completed the transformation of 366 stores since the launch of the current program in 2019.

We continue to evaluate potential acquisition targets that we believe would fit our growth strategy while maintaining financial discipline. We believe we have sufficient resources available (including cash flow from operations and, if necessary, cash on hand and/or bank financing) to expand our business as currently planned for the next twelve months.

Contractual Obligations

Commitments Due by Period				Within		2 to		4 to		After
(thousands)		Total		1 Year		3 Years		5 Years		5 Years
Principal payments on long-term debt	$	190,000					$	190,000
Finance lease commitments/financing obligations (a)		516,579	$	55,389	$	109,892		100,486	$	250,812
Operating lease commitments (a)		239,546		36,451		66,066		53,575		83,454
Accrued rent		1,807		1,563		132		42		70
Other liabilities		1,133		800		333		—		—
Total	$	949,065	$	94,203	$	176,423	$	344,103	$	334,336

(a)Finance and operating lease commitments represent future undiscounted lease payments and include $108.4 million and $61.0 million, respectively, related to options to extend lease terms that are reasonably certain of being exercised.

During 2021, we negotiated rent deferrals, with repayment at later dates, for a significant number of our store leases. These concessions provide a deferral of rent payments with no substantive changes to the original contract. Consistent with updated guidance from the FASB in April 2020, we have elected to treat the rent deferrals as accrued liabilities. The accrued rent reflected in the table above includes $0.8 million related to rent deferrals due primarily in the first and second quarter of 2022 and $1.0 million due to timing of other lease related expenses. We will continue to recognize expense during the deferral periods.

In addition, during 2021, we negotiated rent reductions with certain landlords on approximately 23 percent of our lease contracts in exchange for extending our current lease term. As these agreements represent substantive changes to our contractual obligations, the leases were remeasured. As a result, finance lease and financing obligation assets, net and finance leases and financing obligations were increased by $67.7 million and $64.0 million, respectively, and operating lease assets, net and operating lease liabilities were increased by $16.2 million and $20.0 million, respectively. The negotiated terms were generally consistent with terms of typical renewal agreements.

Liquidity

Interest only is payable monthly throughout the term of our Credit Facility. The borrowing capacity for the Credit Facility of $600 million includes an accordion feature permitting us to request an increase in availability of up to an additional $250 million.

On June 11, 2020, we entered into a First Amendment to the Credit Facility (the “First Amendment”), which, among other things, amended the terms of certain of the financial and restrictive covenants in the credit agreement through the first quarter of 2022 to provide us with additional flexibility to operate our business. The First Amendment permanently amended the interest rate charged on

Monro, Inc. 2021 Form 10-K 25

borrowings to be based on the greater of adjusted one-month LIBOR or 0.75 percent. For the period from June 30, 2020 to June 30, 2021, the minimum interest rate spread charged on borrowings will be 225 basis points over LIBOR. Additionally, during the same period, we may declare, make or pay any dividend or distribution up to $38.5 million in the aggregate and the acquisition of stores or other businesses up to $100 million in the aggregate are permitted if we are in compliance with the financial covenants and other restrictions in the First Amendment and Credit Facility. The Credit Facility requires fees payable quarterly throughout the term between 0.125 percent and 0.35 percent of the amount of the average net availability under the Credit Facility during the preceding quarter. Except as amended by the First Amendment, the remaining terms of the credit agreement remain in full force and effect.

Within the Credit Facility, we have a sub-facility of $80 million available for the purpose of issuing standby letters of credit. The line requires fees aggregating 87.5 to 212.5 basis points annually of the face amount of each standby letter of credit, payable quarterly in arrears. There was a $33.6 million outstanding letter of credit at March 27, 2021.

Mortgages and specific lease financing arrangements with other parties (with certain limitations) are permitted under the Credit Facility. Other specific terms and the maintenance of specified ratios are generally consistent with our prior financing agreement. Additionally, the Credit Facility is not secured by our real property, although we have agreed not to encumber our real property, with certain permissible exceptions.

In order to enhance our liquidity position during the COVID-19 pandemic, we took a precautionary measure and borrowed $350 million available to us under our Credit Facility in March 2020, which we subsequently repaid in 2021. There was $190.0 million outstanding and $376.4 million available under the Credit Facility at March 27, 2021.

We were in compliance with all debt covenants at March 27, 2021.

As of May 21, 2021, we had approximately $18.0 million in cash on hand. We believe that we can fulfill our commitments and working capital needs utilizing our cash flow from operations and, if necessary, cash on hand and/or bank financing for at least the next 12 months and the foreseeable future.

Off Balance Sheet Arrangements

We do not have any material off-balance sheet arrangements at March 27, 2021.

Critical Accounting Policies

Our consolidated financial statements are prepared in accordance with GAAP, which requires us to make estimates and apply judgments that affect the reported amounts. In Note 1 to the Company’s consolidated financial statements, we describe the significant accounting policies used in preparing the consolidated financial statements. Our management believes that the accounting policies listed below are those that are most critical to the portrayal of our financial condition and results of operations, and that required management’s most difficult, subjective and complex judgments in estimating the effect of inherent uncertainties.

Business Combinations

We use the acquisition method in accounting for acquired businesses. Under the acquisition method, our financial statements reflect the operations of an acquired business starting from the completion of the acquisition. The assets acquired and liabilities assumed are recorded at their respective estimated fair values at the date of the acquisition. Any excess of the purchase price over the estimated fair values of the identifiable net assets acquired is recorded as goodwill. Significant judgment is often required in estimating the fair value of assets acquired, particularly the right of use (“ROU”) assets and intangible assets, including trade names and customer relationships. ROU assets are recorded at the present value of remaining lease payments adjusted to reflect favorable or unfavorable market terms of the lease. As a result, in the case of significant acquisitions, we normally obtain the assistance of a third-party valuation specialist in estimating the value of the ROU assets as well as intangible assets. The fair value measurements are based on available historical information and on expectations and assumptions about the future, considering the perspective of marketplace participants. Favorable or unfavorable market terms used to value the ROU assets are estimated based on comparable market data. Fair values of acquired trade names are estimated using an income approach, specifically the relief-from-royalty method. Customer relationships are valued using the cost approach or an income approach such as the excess earnings method. Assumptions utilized in the determination of fair value include forecasted sales, discount rates, royalty rates (trade names) and customer attrition rates (customer relationships). While we believe the expectations and assumptions about the future are reasonable, they are inherently uncertain. Unanticipated market or macroeconomic events and circumstances, like the COVID-19 pandemic, may occur, which could affect the accuracy or validity of the estimates and assumptions.

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Carrying Values of Goodwill and Long-Lived Assets

We have a history of growth through acquisitions. Assets and liabilities of acquired businesses are recorded at their estimated fair values as of the date of acquisition. Goodwill represents consideration paid in excess of fair values assigned to the underlying net assets of acquired businesses. The carrying value of goodwill is subject to an annual impairment test, which we perform in the third quarter of the fiscal year. Impairment tests may also be triggered by any significant events or changes in circumstances affecting our business.

We have one reporting unit which encompasses all operations including new acquisitions. In performing our annual goodwill impairment test, we perform a qualitative assessment to determine if it is more likely than not that the fair value is less than the carrying value of goodwill. The qualitative assessment includes a review of business changes, economic outlook, financial trends and forecasts, growth rates, industry data, market capitalization and other relevant qualitative factors. If the qualitative factors indicate a potential impairment, we compare the fair value of our reporting unit to the carrying value of our reporting unit. If the fair value is less than its carrying value, an impairment charge is recognized in an amount equal to that excess. The loss recognized cannot exceed the carrying amount of goodwill. We believe there is little risk of impairment of our goodwill.

Our intangible assets primarily represent allocations of purchase price to identifiable intangible assets of acquired businesses and are amortized over their estimated useful lives. All intangibles and other long-lived assets, which include property and equipment as well as ROU assets, are reviewed whenever events or changes in circumstances indicate that an impairment may exist. If such indicators are present, it is determined whether the sum of the estimated undiscounted future cash flows attributable to such assets is less than their carrying values.

A deterioration of macroeconomic conditions may not only negatively impact the estimated operating cash flows used in our cash flow models, but may also negatively impact other assumptions used in our analyses, including, but not limited to, the estimated cost of capital and/or discount rates. Additionally, we are required to ensure that assumptions used to determine fair value in our analyses are consistent with the assumptions a hypothetical marketplace participant would use. As a result, the cost of capital and/or discount rates used in our analyses may increase or decrease based on market conditions and trends, regardless of whether our actual cost of capital has changed. Therefore, we may recognize an impairment of an intangible asset or assets even though realized actual cash flows are approximately equal to or greater than our previously forecasted amounts.

Self-Insurance Reserves

We are largely self-insured with respect to workers’ compensation, general liability and employee medical claims. In order to reduce our risk and better manage our overall loss exposure, we purchase stop-loss insurance that covers individual claims in excess of the deductible amounts, and caps total losses in a fiscal year. We maintain an accrual for the estimated cost to settle open claims as well as an estimate of the cost of claims that have been incurred but not reported. These estimates take into consideration the historical average claim volume, the average cost for settled claims, current trends in claim costs, changes in our business and workforce, and general economic factors. These accruals are reviewed on a quarterly basis. For more complex reserve calculations, such as workers’ compensation, we periodically use the services of an actuary to assist in determining the required reserve for open claims.

Income Taxes

We estimate our provision for income taxes, deferred tax assets and liabilities, income taxes payable and unrecognized tax benefit liabilities based on a number of factors including, but not limited to, historical pre-tax operating income, future estimates of pre-tax operating income, tax planning strategies, differences between tax laws and accounting rules of various items of income and expense, statutory tax rates and credits, uncertain tax positions and valuation allowances. We use significant judgment and estimates in evaluating our tax positions.

We record deferred tax assets and liabilities based upon the expected future tax outcome of differences between tax laws and accounting rules of various items of income and expense recognized in our results of operations using enacted tax rates in effect for the year in which the future tax outcome is expected. We evaluate our ability to realize the tax benefits associated with deferred tax assets and establish valuation allowances when we believe it is more likely than not that some portion of our deferred tax assets will not be realized.

We file U.S. federal income tax returns and income tax returns in various state jurisdictions. Monro’s 2020, 2019 and 2018 U.S. federal tax years and various state tax years remain subject to income tax examinations by tax authorities. We establish tax liabilities in accordance with the accounting guidance on income taxes. Under the accounting guidance, we measure and recognize the tax benefit from an uncertain tax position taken or expected to be taken on an income tax return based on the largest benefit that is more likely than not of being realized upon settlement. An uncertain income tax position will not be recognized in the financial statements unless it is more likely than not to be sustained. We adjust these tax liabilities for unrecognized tax benefits, as well as the related

Monro, Inc. 2021 Form 10-K 27

interest and penalties, based on the latest facts and circumstances, including recently published rulings, court cases and outcomes of tax audits. Due to the complexity of some of these uncertainties, the ultimate resolution may result in an actual tax liability that differs from our estimated tax liabilities for unrecognized tax benefits and our effective tax rate may be materially impacted. While it is often difficult to predict the final outcome of, the timing of, or the tax treatment of any particular uncertain tax position, we believe that our tax balances reflect the more likely than not outcome of known tax contingencies.

Accounting Standards

See “Recent Accounting Pronouncements” in Note 1 to the Company’s consolidated financial statements for a discussion of the impact of recently issued accounting standards on our consolidated financial statements as of March 27, 2021 and for the year then ended, as well as the expected impact on the consolidated financial statements for future periods.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to market risk from potential changes in interest rates. As of March 27, 2021, excluding finance leases and financing obligations, we had no debt financing at fixed interest rates, for which the fair value would be affected by changes in market interest rates. Our cash flow exposure on floating rate debt would result in annual interest expense fluctuations of approximately $1.9 million, based upon our debt position as of March 27, 2021, given a change in LIBOR of 100 basis points.

Debt financing had a carrying amount and a fair value of $190.0 million as of March 27, 2021, as compared to a carrying amount and a fair value of $566.4 million as of March 28, 2020.

‎

Monro, Inc. 2021 Form 10-K 28

Item 8. Financial Statements and Supplementary Data

	Page
Report on Management’s Assessment on Internal Control Over Financial Reporting	30
Report of Independent Registered Public Accounting Firm	31
Audited Financial Statements:
Consolidated Balance Sheets	33
Consolidated Statements of Income and Comprehensive Income	34
Consolidated Statements of Changes in Shareholders' Equity	35
Consolidated Statements of Cash Flows	36
Notes to Consolidated Financial Statements	37
Note 1 Description of Business, Basis of Presentation and Summary of Significant Accounting Policies	37
Note 2 Impact of the COVID-19 Pandemic	41
Note 3 Acquisitions	42
Note 4 Other Current Assets	45
Note 5 Property and Equipment	45
Note 6 Goodwill and Intangible Assets	46
Note 7 Long-term Debt	46
Note 8 Revenue	47
Note 9 Income Taxes	48
Note 10 Stock Ownership	49
Note 11 Share-based Compensation	50
Note 12 Earnings Per Share	51
Note 13 Leases	52
Note 14 Defined Benefit and Defined Contribution Plans	53
Note 15 Commitments and Contingencies	56
Note 16 Subsequent Events	56

‎

Monro, Inc. 2021 Form 10-K 29

Report on Management’s Assessment of Internal Control Over Financial Reporting

Management of Monro, Inc. (the “Company”) is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended. The Company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with generally accepted accounting principles.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of March 27, 2021. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (2013). Based on our assessment, management determined that the Company maintained effective internal control over financial reporting as of March 27, 2021.

The Company’s independent registered public accounting firm, PricewaterhouseCoopers LLP, is appointed by the Company’s Audit Committee. PricewaterhouseCoopers LLP has audited the consolidated financial statements included in this Annual Report on Form 10-K and the effectiveness of the Company’s internal control over financial reporting as of March 27, 2021, and as a part of their integrated audit, has issued their report, included herein, on the effectiveness of the Company’s internal control over financial reporting.

/s/ Michael T. Broderick     /s/ Brian J. D’Ambrosia

Michael T. Broderick     Brian J. D’Ambrosia

Chief Executive Officer     Chief Financial Officer

(Principal Executive Officer)    (Principal Financial Officer)

May 26, 2021

‎

Monro, Inc. 2021 Form 10-K 30

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of Monro, Inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Monro, Inc. and its subsidiaries (the “Company”) as of March 27, 2021 and March 28, 2020, and the related consolidated statements of income and comprehensive income, of changes in shareholders’ equity and of cash flows for each of the three years in the period ended March 27, 2021, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of March 27, 2021, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of March 27, 2021 and March 28, 2020, and the results of its operations and its cash flows for each of the three years in the period ended March 27, 2021 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of March 27, 2021, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Change in Accounting Principle

As discussed in Note 1 to the consolidated financial statements, the Company changed the manner in which it accounts for leases at the beginning of the year ended March 28, 2020.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Report on Management’s Assessment of Internal Control Over Financial Reporting. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Monro, Inc. 2021 Form 10-K 31

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Valuation of Acquired Right of Use Assets

As described in Note 3 to the consolidated financial statements, the Company recorded $5 million of finance lease and financing obligation assets, net and $9 million of operating lease assets, net (collectively “right of use assets”) relating to a business combination completed during the year ended March 27, 2021. The right of use assets acquired are recorded at the present value of remaining lease payments adjusted to reflect favorable or unfavorable market terms of the lease.  Management applied significant judgment in estimating the favorable or unfavorable market terms used to value the acquired right of use assets, which is estimated based on comparable market data.

The principal considerations for our determination that performing procedures relating to the valuation of acquired right of use assets is a critical audit matter are the significant judgment by management in estimating the favorable or unfavorable market terms used to value the acquired right of use assets and the comparable market data assumption.  This in turn led to a high degree of auditor judgment, effort, and subjectivity in performing procedures related to the favorable or unfavorable market terms used to value the acquired right of use assets and the comparable market data assumption.  In addition, the audit effort involved the use of professionals with specialized skill and knowledge. 

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.  These procedures included testing the effectiveness of controls over the estimation of the value of the acquired right of use assets, including controls over the estimate of favorable or unfavorable market terms. These procedures also included, among others, (i) reading the purchase agreement; (ii) testing management’s process for estimating the value of the acquired right of use assets; and (iii) evaluating the appropriateness of the valuation method and testing the completeness and accuracy of the underlying data. Professionals with specialized skill and knowledge were used to assist in evaluating the reasonableness of the comparable market data assumption.

/s/ PricewaterhouseCoopers LLP

Rochester, New York

May 26, 2021

We have served as the Company’s auditor since at least 1984. We have not been able to determine the specific year we began serving as auditor of the Company.

Monro, Inc. 2021 Form 10-K 32

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Balance Sheets

(thousands, except footnotes)		March 27, 2021		March 28, 2020
Assets
Current assets
Cash and equivalents	$	29,960	$	345,476
Accounts receivable		15,324		14,510
Federal and state income taxes receivable		10,844		8,056
Inventories		162,282		187,441
Other current assets		48,115		40,537
Total current assets		266,525		596,020
Property and equipment, net		327,063		328,637
Finance lease and financing obligation assets, net		275,360		196,575
Operating lease assets, net		203,329		199,729
Goodwill		689,524		671,843
Intangible assets, net		26,068		29,781
Other non-current assets		18,332		20,688
Long-term deferred income tax assets		5,613		6,184
Total assets	$	1,811,814	$	2,049,457
Liabilities and shareholders' equity
Current liabilities
Current portion of finance leases and financing obligations	$	37,803	$	32,257
Current portion of operating lease liabilities		30,903		30,181
Accounts payable		112,378		99,504
Accrued payroll, payroll taxes and other payroll benefits		20,842		14,429
Accrued insurance		49,681		43,387
Deferred revenue		11,956		13,129
Other current liabilities		27,053		22,049
Total current liabilities		290,616		254,936
Long-term debt		190,000		566,400
Long-term finance leases and financing obligations		366,330		298,373
Long-term operating lease liabilities		177,724		170,954
Other long-term liabilities		16,649		12,873
Long-term deferred income tax liabilities		19,783		10,069
Long-term income taxes payable		1,028		1,412
Total liabilities		1,062,130		1,315,017
Commitments and contingencies – Note 15
Shareholders' equity
Class C Convertible Preferred Stock		29		33
Common Stock		398		396
Treasury Stock		(108,729)		(108,729)
Additional paid-in capital		238,244		229,774
Accumulated other comprehensive loss		(4,619)		(6,889)
Retained earnings		624,361		619,855
Total shareholders' equity		749,684		734,440
Total liabilities and shareholders' equity	$	1,811,814	$	2,049,457

Class C Convertible Preferred Stock Authorized 150,000 shares, $1.50 par value, $0.064 conversion value: 19,664 shares issued and outstanding at March 27, 2021; 21,802 shares issued and outstanding at March 28, 2020

Common Stock Authorized 65,000,000 shares, $0.01 par value; 39,848,093 shares issued as of March 27, 2021; 39,644,228 shares issued at March 28, 2020

Treasury Stock 6,359,871 shares, at cost

See accompanying Notes to Consolidated Financial Statements.

Monro, Inc. 2021 Form 10-K 33

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statements of Income and Comprehensive Income

(thousands, except per share data)		2021		2020		2019
Sales	$	1,125,721	$	1,256,524	$	1,200,230
Cost of sales, including distribution and occupancy costs		730,526		779,866		735,002
Gross profit		395,195		476,658		465,228
Operating, selling, general and administrative expenses		322,957		374,956		338,485
Operating income		72,238		101,702		126,743
Interest expense, net of interest income		28,235		28,213		27,013
Other income, net of other loss		(188)		(785)		(630)
Income before income taxes		44,191		74,274		100,360
Provision for income taxes		9,872		16,250		20,608
Net income	$	34,319	$	58,024	$	79,752
Other comprehensive income (loss)
Changes in pension, net of tax provision (benefit)		2,270		(2,353)		(288)
Other comprehensive income (loss)		2,270		(2,353)		(288)
Comprehensive income	$	36,589	$	55,671	$	79,464
Earnings per share
Basic	$	1.02	$	1.73	$	2.41
Diluted	$	1.01	$	1.71	$	2.37
Weighted average common shares outstanding
Basic		33,329		33,246		32,980
Diluted		33,876		33,953		33,675

See accompanying Notes to Consolidated Financial Statements. 

‎

Monro, Inc. 2021 Form 10-K 34

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statements of Changes in Shareholders’ Equity

	Class C Convertible									Additional		Accumulated Other
	Preferred Stock			Common Stock			Treasury Stock			Paid-In		Comprehensive		Retained		Total
(thousands)	Shares	Amount		Shares	Amount		Shares	Amount		Capital		Loss		Earnings		Equity
Balance at March 31, 2018	22	$	33	39,166	$	392	6,330	$	(106,563)	$	199,576	$	(4,248)	$	539,286	$	628,476
Net income															79,752		79,752
Other comprehensive loss
Pension liability adjustment													(288)				(288)
Dividends declared
Preferred															(408)		(408)
Common															(26,406)		(26,406)
Dividend payable															(50)		(50)
Stock options and restricted stock (a)				345		3	30		(2,166)		16,575						14,412
Share-based compensation											4,022						4,022
Balance at March 30, 2019	22	$	33	39,511	$	395	6,360	$	(108,729)	$	220,173	$	(4,536)	$	592,174	$	699,510
Cumulative effect of accounting change															(582)		(582)
Net income															58,024		58,024
Other comprehensive loss
Pension liability adjustment													(2,353)				(2,353)
Dividends declared
Preferred															(449)		(449)
Common															(29,266)		(29,266)
Dividend payable															(46)		(46)
Stock options and restricted stock				134		1					5,788						5,789
Share-based compensation											3,813						3,813
Balance at March 28, 2020	22	$	33	39,645	$	396	6,360	$	(108,729)	$	229,774	$	(6,889)	$	619,855	$	734,440
Net income															34,319		34,319
Other comprehensive loss
Pension liability adjustment													2,270				2,270
Dividends declared
Preferred															(438)		(438)
Common															(29,344)		(29,344)
Dividend payable															(31)		(31)
Conversion of Class C Preferred Stock	(2)		(4)	50		1					3						-
Stock options and restricted stock				153		1					6,076						6,077
Share-based compensation											2,391						2,391
Balance at March 27, 2021	20	$	29	39,848	$	398	6,360	$	(108,729)	$	238,244	$	(4,619)	$	624,361	$	749,684

(a)Includes the receipt of treasury stock in connection with the exercise of stock options and to partially satisfy tax withholding obligations.

We declared $0.88, $0.88 and $0.80 dividends per common share or equivalent for the years ended March 27, 2021, March 28, 2020 and March 30, 2019, respectively.

See accompanying Notes to Consolidated Financial Statements.

‎

Monro, Inc. 2021 Form 10-K 35

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statements of Cash Flows

(thousands)		2021		2020		2019
Operating activities:
Net income	$	34,319	$	58,024	$	79,752
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		77,304		64,986		55,531
Share-based compensation expense		2,391		3,813		4,022
(Gain) loss on disposal of assets		(491)		(257)		56
Impairment of long-lived assets		144		6,579		—
Deferred income tax expense		10,854		11,473		12,517
Change in operating assets and liabilities (excluding acquisitions)
Accounts receivable		(814)		107		(1,361)
Inventories		26,570		(11,841)		(9,126)
Other current assets		22,566		5,379		(514)
Other non-current assets		3,331		24,968		(427)
Accounts payable		12,874		(4,090)		19,037
Accrued expenses		21,355		(3,871)		(3,019)
Federal and state income taxes receivable		(2,788)		(2,470)		(1,401)
Other long-term liabilities		(22,326)		(31,100)		(1,967)
Long-term income taxes payable		(384)		(371)		(209)
Cash provided by operating activities		184,905		121,329		152,891
Investing activities
Capital expenditures		(51,725)		(55,918)		(44,468)
Acquisitions, net of cash acquired		(17,154)		(104,436)		(62,427)
Proceeds from the disposal of assets		659		967		723
Other		1,960		576		289
Cash used for investing activities		(66,260)		(158,811)		(105,883)
Financing activities:
Proceeds from borrowings		—		814,181		433,460
Principal payments on long-term debt, capital leases and financing obligations		(409,783)		(412,725)		(463,989)
Exercise of stock options		6,278		6,171		14,640
Dividends paid		(29,782)		(29,715)		(26,814)
Deferred financing costs		(874)		(1,168)		—
Cash (used for) provided by financing activities		(434,161)		376,744		(42,703)
Net (decrease) increase in cash		(315,516)		339,262		4,305
Cash at beginning of year		345,476		6,214		1,909
Cash at end of year	$	29,960	$	345,476	$	6,214
Supplemental information:
Interest paid, net	$	26,376	$	27,250	$	25,422
Income taxes		2,334		12,745		9,680
Leased assets obtained in exchange for new finance lease liabilities		104,165		64,393		14,632
Leased assets obtained in exchange for new operating lease liabilities		24,409		6,980		—

See accompanying Notes to Consolidated Financial Statements.

Monro, Inc. 2021 Form 10-K 36

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Note 1 – Description of Business, Basis of Presentation and Summary of Significant Accounting Policies

Description of business

Monro, Inc. and its direct and indirect subsidiaries (together, “Monro”, the “Company”, “we”, “us”, or “our”), are engaged principally in providing automotive undercar repair and tire replacement sales and tire related services in the United States. Monro had 1,263 Company-operated stores, 96 franchised locations, seven wholesale locations and three retread facilities located in 32 states as of March 27, 2021.

Monro’s operations are organized and managed in one operating segment. The internal management financial reporting that is the basis for evaluation in order to assess performance and allocate resources by our chief operating decision maker consists of consolidated data that includes the results of our retail, commercial and wholesale locations. As such, our one operating segment reflects how our operations are managed, how resources are allocated, how operating performance is evaluated by senior management and the structure of our internal financial reporting.

Basis of presentation

Principles of consolidation

The consolidated financial statements include the accounts of Monro, Inc. and its direct and indirect subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Management’s use of estimates

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of financial statements in conformity with such principles requires the use of estimates by management during the reporting period. Actual results could differ from those estimates.

Fiscal year

We operate on a 52/53 week fiscal year ending on the last Saturday in March. Fiscal years 2021 and 2020 each contained 52 weeks and fiscal year 2019 contained 53 weeks. Unless specifically indicated otherwise, any references to “2021” or “fiscal 2021,” “2020” or “fiscal 2020,” and “2019” or “fiscal 2019” relate to the years ended March 27, 2021, March 28, 2020 and March 30, 2019, respectively.

Recent accounting pronouncements

In August 2018, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance which eliminates, adds and modifies certain disclosure requirements for fair value measurements. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2019. Early adoption is permitted. We adopted this guidance during the first quarter of 2021. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In December 2019, the FASB issued new accounting guidance intended to simplify the accounting for income taxes. The new guidance removes certain exceptions to the general principles in Accounting Standards Codification (“ASC”) Topic 740, “Income Taxes,” and amends existing guidance to improve consistent application. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2020. Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

Other recent authoritative guidance issued by the FASB (including technical corrections to the ASC) and the Securities and Exchange Commission (“SEC”) did not, or are not expected to have a material effect on Monro’s consolidated financial statements.

Summary of significant accounting policies

Cash and cash equivalents

Cash consists primarily of cash on hand and deposits with banks. Cash equivalents include highly liquid investments with an original maturity of three months or less from the time of purchase. Cash equivalents also include amounts due from third-party financial institutions for credit and debit card transactions. These receivables typically settle in three days or less.

Monro, Inc. 2021 Form 10-K 37

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Inventories

Our inventories, which consist of automotive parts and oil as well as tires, are valued at the lower of weighted average cost or net realizable value.

Property and equipment, net

Property and equipment, net is stated at historical cost less accumulated depreciation. Property and equipment is depreciated using the straight-line method over estimated useful lives. Leasehold improvements are depreciated over the shorter of their estimated useful lives or the related lease terms. When assets are disposed of, the resulting gain or loss is recognized in other income, net of other loss on the Consolidated Statement of Income and Comprehensive Income. Expenditures for maintenance and repairs are expensed as incurred.

Estimated Useful Lives	Life (Years)
Buildings and improvements	10 - 39
Equipment, signage and fixtures	3 - 15
Vehicles	5 - 10

Valuation of long-lived assets

We assess potential impairments to our long-lived assets, which include property and equipment and operating right-of-use (“ROU”) assets, whenever events or circumstances indicate that the carrying value of an asset may not be recoverable. Long-lived assets are grouped and evaluated for impairment at the lowest level for which there are identifiable cash flows that are independent of the cash flows of other groups of assets. If it is determined that the carrying amounts of such long-lived assets are not recoverable, the assets are written down to their estimated fair values. Fair value of the assets is determined based on the highest and best use of the asset group, considering external market participant assumptions. Since the determination of future cash flows is an estimate of future performance, there may be future impairments in the event that future cash flows do not meet expectations.

During 2020, we evaluated certain stores having indicators of impairment based on operating performance and taking into consideration the negative impact of the novel coronavirus strain (“COVID-19”) pandemic on forecasted store performance. Based on the estimate of future recoverable cash flows, we recorded an impairment charge totaling $6.6 million of which $4.3 million was related to 36 stores that closed in 2021. As part of the impairment charge, we wrote off $4.4 million of operating lease ROU assets, $0.6 million of finance lease ROU assets and $1.6 million of leasehold improvements and equipment.

No material impairment charges were recorded during 2021 or 2019.

Leases

We determine if an arrangement is or contains a lease at inception. We record ROU assets and lease obligations for our finance and operating leases, which are initially based on the discounted future minimum lease payments over the term of the lease. As the rate implicit in our leases is not easily determinable, our applicable incremental borrowing rate is used in calculating the present value of the lease payments. We estimate our incremental borrowing rate considering the market rates of our outstanding borrowings and comparisons to comparable borrowings of similar terms.

Lease term is defined as the non-cancelable period of the lease plus any option to extend the lease when it is reasonably certain that it will be exercised. For leases with an initial term of 12 months or less, no ROU assets or lease obligations are recorded on the balance sheet and we recognize short-term lease expense for these leases on a straight-line basis over the lease term.

Certain of our lease agreements include rental payments based on a percentage of retail sales over specified levels and others include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. For the majority of all classes of underlying assets, we have elected to separate lease from non-lease components. We have elected to combine lease and non-lease components for certain classes of equipment. We generally sublease excess space to third parties.

Operating lease expense is recognized on a straight-line basis over the lease term and is included in cost of sales, including distribution and occupancy costs (“cost of sales”) or operating, selling, general and administrative (“OSG&A”) expense. Amortization expense for

Monro, Inc. 2021 Form 10-K 38

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

finance leases is recognized on a straight-line basis over the lease term and is included in cost of sales or OSG&A expense. Interest expense for finance leases is recognized using the effective interest method, and is included in interest expense, net of interest income. Variable payments, short-term rentals and payments associated with non-lease components are expensed as incurred.

Effective March 31, 2019, we adopted using the modified retrospective approach an accounting standards update with new guidance related to leases. The adoption of this guidance resulted in a $165.3 million increase to total assets, a $165.9 million increase to total liabilities and a $0.6 million decrease in shareholder’s equity as of March 31, 2019. Periods prior to fiscal 2020 have not been restated for the adoption of this standard update.

Goodwill and intangible assets

We have a history of growth through acquisitions. Assets and liabilities of acquired businesses are recorded at their estimated fair values as of the date of acquisition. Goodwill represents costs in excess of fair values assigned to the underlying net assets of acquired businesses. The carrying value of goodwill is subject to an annual impairment test, which we perform in the third quarter of the fiscal year. Impairment tests may also be triggered by any significant events or changes in circumstances affecting our business.

We have one reporting unit which encompasses all operations including new acquisitions. In performing our annual goodwill impairment test, we perform a qualitative assessment to determine if it is more likely than not that the fair value is less than the carrying value of goodwill. The qualitative assessment includes a review of business changes, economic outlook, financial trends and forecasts, growth rates, industry data, market capitalization and other relevant qualitative factors. If the qualitative factors indicate a potential impairment, we compare the fair value of our reporting unit to the carrying value of our reporting unit. If the fair value is less than its carrying value, an impairment charge is recognized in an amount equal to that excess. The loss recognized cannot exceed the carrying amount of goodwill. As a result of our annual qualitative assessment performed in the third quarter of 2021, we determined that it is not more likely than not that the fair value is less than the carrying value.

Subsequent to our prior year assessment performed in the third quarter of 2020, and due to developments associated with the COVID-19 pandemic, we considered our business performance expectations, as well as our share price as of 2020 year end in relation to the share price when the annual qualitative assessment was performed in the third quarter of 2020. Based on our analysis, we concluded that the events and circumstances related to the COVID-19 pandemic did not indicate an impairment of goodwill was more likely than not as of March 28, 2020.

Our intangible assets primarily represent allocations of purchase price to identifiable intangible assets of acquired businesses and are amortized over their estimated useful lives. All intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that an impairment may exist. If such indicators are present, it is determined whether the sum of the estimated undiscounted future cash flows attributable to such assets is less than their carrying values. Based on our review as of March 27, 2021, we concluded that the carrying values of our intangible assets were not impaired. No impairment was recorded in 2021, 2020 or 2019.

A deterioration of macroeconomic conditions may not only negatively impact the estimated operating cash flows used in our cash flow models, but may also negatively impact other assumptions used in our analyses, including, but not limited to, the estimated cost of capital and/or discount rates. Additionally, we are required to ensure that assumptions used to determine fair value in our analyses are consistent with the assumptions a hypothetical marketplace participant would use. As a result, the cost of capital and/or discount rates used in our analyses may increase or decrease based on market conditions and trends, regardless of whether our actual cost of capital has changed. Therefore, we may recognize an impairment of an intangible asset or assets even though realized actual cash flows are approximately equal to or greater than our previously forecasted amounts.

Self-insurance reserves

We are largely self-insured with respect to workers’ compensation, general liability and employee medical claims. In order to reduce our risk and better manage our overall loss exposure, we purchase stop-loss insurance that covers individual claims in excess of the deductible amounts, and caps total losses in a fiscal year. We maintain an accrual for the estimated cost to settle open claims as well as an estimate of the cost of claims that have been incurred but not reported. These estimates take into consideration the historical average claim volume, the average cost for settled claims, current trends in claim costs, changes in our business and workforce, and general economic factors. These accruals are reviewed on a quarterly basis, or more frequently if factors dictate a more frequent review is warranted. For more complex reserve calculations, such as workers’ compensation, we periodically use the services of an actuary to assist in determining the required reserve for open claims.

Monro, Inc. 2021 Form 10-K 39

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Warranty

We provide an accrual for estimated future warranty costs for parts that we install based upon the historical relationship of warranty costs to sales. Warranty expense related to all product warranties for the fiscal years ended March 2021, 2020 and 2019 was not material to our financial position or results of operations. See Note 8 for additional information on tire road hazard warranty agreements.

Comprehensive income

As it relates to Monro, comprehensive income is defined as net income as adjusted for pension liability adjustments and is reported net of related taxes in the Consolidated Statements of Income and Comprehensive Income and in the Consolidated Statements of Changes in Shareholders’ Equity.

Income taxes

We account for income taxes pursuant to the asset and liability method which requires the recognition of deferred tax assets and liabilities related to the expected future tax consequences arising from temporary differences between the carrying amounts and tax bases of assets and liabilities based on enacted statutory tax rates applicable to the periods in which the temporary differences are expected to reverse. Any effects of changes in income tax rates or laws are included in income tax expense in the period of enactment. A valuation allowance is recognized if we determine it is more likely than not that all or a portion of a deferred tax asset will not be recognized. In making such determination, the Company considers all available evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent and expected future results of operation. Monro recognizes a tax benefit from an uncertain tax position in the financial statements only when it is more likely than not that the position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits and a consideration of the relevant taxing authority's administrative practices and precedents.

On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) to provide certain relief as a result of the COVID-19 pandemic. The CARES Act provides tax relief, along with other stimulus measures, including an employer deferral of the deposit of the employer’s share of social security taxes during the period beginning March 27, 2020 and ending December 31, 2020. We deferred the employer paid portion of social security taxes as permitted by the CARES Act during fiscal 2021 and may continue to defer payment prior to the applicable date the deposits must be paid.

Treasury stock

Treasury stock is accounted for using the par value method.

Share-based compensation

We provide share-based compensation through non-qualified stock options, restricted stock awards and restricted stock units. We measure compensation cost arising from the grant of share-based payments to an employee at fair value, and recognize such cost in income over the period during which the employee is required to provide service in exchange for the award, usually the vesting period. The fair value of each option award is estimated on the date of grant primarily using the Black-Scholes option valuation model. The assumptions used to estimate fair value require judgment and are subject to change in the future due to factors such as employee exercise behavior, stock price trends, and changes to type or provisions of share-based awards. Any material change in one or more of these assumptions could have an impact on the estimated fair value of a future award.

Black-Scholes Valuation Model Assumptions
(weighted-average)	2021		2020		2019
Risk-free interest rate (a)	0.27	%	1.85	%	2.81	%
Expected term (years) (b)	4		4		4
Expected volatility (c)	33.3	%	30.4	%	28.3	%
Dividend yield (d)	1.60	%	1.12	%	1.24	%

(a) Risk-free interest rates are yields for zero coupon U.S. Treasury notes maturing approximately at the end of the expected option term.

(b)Expected term is based on historical exercise behavior and on the terms and conditions of the stock option award.

(c)Expected volatility is based on a combination of historical volatility, using Monro stock prices over a period equal to the expected term, and implied market volatility.

(d)Dividend yield is based on historical dividend experience and expected future changes, if any.

Monro, Inc. 2021 Form 10-K 40

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

The fair value of restricted stock awards and restricted stock units (collectively “restricted stock”) is determined based on the stock price at the date of grant.

We are required to estimate forfeitures and only record compensation costs for those awards that are expected to vest. The assumptions for forfeitures were determined based on type of award and historical experience. Forfeiture assumptions are adjusted at the point in time a significant change is identified, with any adjustment recorded in the period of change, and the final adjustment at the end of the requisite service period to equal actual forfeitures.

We recognize compensation expense related to stock options and restricted stock using the straight-line approach. Option awards and restricted stock generally vest equally over the service period established in the award, typically three years or four years. In 2020 and 2019, the Company issued a limited number of restricted stock units to members of senior management which may vest upon the achievement of a three year average return on invested capital target.

Earnings per common share

Basic earnings per common share amounts are calculated by dividing income available to common shareholders, after deducting preferred stock dividends, by the weighted average number of shares of common stock outstanding. Diluted earnings per common share amounts are calculated by dividing net income by the weighted average number of shares of common stock and common stock equivalents outstanding. Common stock equivalents represent shares issuable upon the assumed exercise of common stock options outstanding.

Advertising

The cost of advertising is generally expensed at the first time the advertising takes place, except for direct response advertising which is capitalized and amortized over its expected period of future benefit.

Direct response advertising consists primarily of coupons for Monro’s services. The capitalized costs of this advertising are amortized over the period of the coupon’s validity, which is typically two months.

Prepaid advertising at March 27, 2021 and March 28, 2020, and advertising expense for 2021, 2020 and 2019, were not material to these financial statements.

Vendor rebates

We receive vendor support in the form of allowances through a variety of vendor-sponsored programs, such as volume rebates, promotions, and advertising allowances, referred to as “vendor rebates”. Vendor rebates are recorded as a reduction of cost of sales.

We establish a receivable for vendor rebates that are earned but not yet received. Based on purchase data and the terms of the applicable vendor-sponsored programs, we estimate the amount earned. The majority of the year-end vendor rebates receivable is collected within the following first quarter. See Note 4 for additional information.

Note 2 – Impact of the COVID-19 Pandemic

In response to the unprecedented and rapid spread of COVID-19, many U.S. state governments, in states in which we operate, enacted stay-at-home restrictions and social distancing measures during fiscal 2021. State and local governments ordered restrictions on the operations of certain businesses, including temporary closures of some businesses, and numerous other businesses temporarily closed voluntarily or transitioned their workforces to working remotely.

Further, individuals’ ability to travel was curtailed through mandated travel restrictions. Throughout 2021, store traffic changed significantly and unpredictably in reaction to the COVID-19 pandemic. Substantially all Company-operated retail stores operated under a reduced schedule throughout the year to match demand.

Given the uncertainties surrounding the impacts of the COVID-19 pandemic on our future financial condition, results of operations and cash flows, we have taken a number of actions in response to prevailing uncertain market conditions. In order to enhance our liquidity position, we took a precautionary measure and borrowed $350 million available to us under our Credit Facility (as defined in Note 7 below) in March 2020. We subsequently repaid the $350 million previously borrowed in March 2020 during 2021.

Monro, Inc. 2021 Form 10-K 41

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Additionally, we negotiated rent deferrals for a significant number of our stores, as well as other rent reductions. See additional discussion of these rent deferrals and reductions in Note 15.

Note 3 – Acquisitions

Monro’s acquisitions are strategic moves in our plan to fill in and expand our presence in our existing and contiguous markets, expand into new markets and leverage fixed operating costs such as distribution, advertising and administration. Acquisitions in this footnote include acquisitions of five or more locations as well as acquisitions of one to four locations that are part of our greenfield store growth strategy.

Subsequent Event

On April 25, 2021, we acquired 30 retail tire and automotive repair stores located in California from Mountain View Tire & Service, Inc. These stores will operate under the Mountain View Tire & Service name. The acquisition was financed through our Credit Facility.

2021

On December 6, 2020, we acquired 17 retail tire and automotive repair stores located in California from Fred Allen Enterprises, Inc. for $17.1 million. These stores will operate under the Tire Choice name. The acquisition was financed through our Credit Facility. The results of operation for the acquisition are included in our financial results from the acquisition date.

Prior to this acquisition, our acquisition activity was paused due to the impact of the COVID-19 pandemic.

The acquisition resulted in goodwill related to, among other things, growth opportunities, synergies and economies of scale expected from combining the business with ours, as well as unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded a customer list intangible asset with a useful life of seven years at its estimated fair value of approximately $0.4 million. We have recorded acquired ROU assets at the present value of remaining lease payments adjusted to reflect favorable or unfavorable market terms of the lease.

We expensed all costs related to the acquisition during 2021. The total costs related to the completed acquisition were $0.3 million and these costs are included in the Consolidated Statement of Income and Comprehensive Income primarily under OSG&A expenses.

Sales and net income related to the completed acquisition totaled $5.8 million and $0.1 million, respectively for the period from acquisition date through March 27, 2021. The net income of $0.1 million includes an allocation of certain traditional corporate related items, including vendor rebates, interest expense and income taxes.

Supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entity was not owned by Monro.

We accounted for the acquisition as a business combination using the acquisition method of accounting in accordance with the FASB ASC Topic 805, “Business Combinations.” The acquired assets and liabilities assumed were recorded at their acquisition-date fair values and were consolidated with those of the Company as of the acquisition date. The acquisition-date fair values were assigned based on preliminary valuations and estimates, and the consideration transferred and net liabilities assumed were recorded as goodwill.

Monro, Inc. 2021 Form 10-K 42

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

2021 Acquisition-date Fair Values Assigned
(thousands)
Inventory	$	1,046
Other current assets		172
Property and equipment		674
Finance lease and financing obligation assets, net		5,089
Operating lease assets, net		8,980
Intangible asset		418
Other non-current assets		30
Long-term deferred income tax assets		1,331
Total assets acquired		17,740
Current portion of finance leases and financing obligations		748
Current portion of operating lease liabilities		976
Deferred revenue		697
Other current liabilities		4
Long-term finance leases and financing obligations		7,911
Long-term operating lease liabilities		7,433
Other long-term liabilities		536
Total liabilities assumed		18,305
Total net identifiable liabilities assumed	$	(565)
Total consideration transferred	$	17,112
Less: total net identifiable liabilities assumed		(565)
Goodwill	$	17,677

The total consideration of $17.1 million is comprised of $16.3 million in cash, and a $0.8 million payable to the seller. The payable is due upon finalization of a lease assignment for one store location.

We continue to refine the valuation data and estimates primarily related to inventory, warranty reserves, intangible assets and real property leases and certain liabilities for the 2021 acquisition and expect to complete the valuations no later than the first anniversary date of the acquisition. We anticipate that adjustments will continue to be made to the fair values of identifiable assets acquired and liabilities assumed and those adjustments may or may not be material.

2020

During 2020, we acquired the following businesses for an aggregate purchase price of $103.7 million. The acquisitions were financed through our Credit Facility. The results of operations for these acquisitions are included in our financial results from the respective acquisition dates.

On November 17, 2019, we acquired 18 retail tire and automotive repair stores located in Nevada and Idaho from Nevada Tire Holdings, LLC and Idaho Tire Holdings, LLC. These stores operate under the Tire Choice name.

On October 27, 2019, we acquired six retail tire and automotive repair stores located in California from S & S Unlimited, Inc. Once converted, expected in fiscal 2022, these stores will operate under the Tire Choice name.

On October 27, 2019, we acquired three retail tire and automotive repair stores located in California from Lloyd’s Tire Service, Inc. Once converted, expected in fiscal 2022, these stores will operate under the Tire Choice name.

On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Atlas Tire Center, Inc. This store operates under the Tire Choice name.

On August 25, 2019, we acquired two retail tire and automotive repair stores located in Louisiana from LRZ3 Auto, LLC. These stores operate under the Tire Choice name.

On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from T-Boy's Tire and Automotive, LLC. This store operates under the Tire Choice name.

Monro, Inc. 2021 Form 10-K 43

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

On August 25, 2019, we acquired two retail tire and automotive repair stores located in Louisiana from Twin Tire & Auto Care, Inc. These stores operate under the Tire Choice name.

On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Twin Tire & Auto Care Team, Inc. This store operates under the Tire Choice name.

On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Scotty's Tire & Automotive, Inc. This store operates under the Tire Choice name.

On June 23, 2019, we acquired two retail tire and automotive repair stores located in California from BAW LLC. These stores operate under the Tire Choice name.

On May 19, 2019, we acquired 40 retail tire and automotive repair stores and one distribution center located in California from Certified Tire & Service Centers, Inc. These stores operate under the Tire Choice name.

On March 31, 2019, we acquired 12 retail tire and automotive repair stores located in Louisiana from Allied Discount Tire & Brake, Inc. These stores operate under the Tire Choice name.

These acquisitions resulted in goodwill related to, among other things, growth opportunities, synergies and economies of scale expected from combining these businesses with ours, as well as unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded certain customer list intangible assets with an average useful life of seven years at their total estimated fair value of approximately $2.8 million. We have recorded acquired ROU assets at the present value of remaining lease payments adjusted to reflect favorable or unfavorable market terms of the lease.

We expensed all costs related to these acquisitions during 2020. The total costs related to the completed acquisitions were $1.4 million for the year ended March 28, 2020. These costs are included in the Consolidated Statement of Income and Comprehensive Income primarily under OSG&A expense.

Sales and net loss for the 2020 acquired locations totaled $59.3 million and ($3.9) million, respectively, for the period from acquisition date through March 28, 2020. The net loss of ($3.9) million includes an allocation of certain traditional corporate related items, including vendor rebates, interest expense and the benefit from income taxes.

Supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entities were not owned by Monro.

We accounted for each 2020 acquisition as a business combination using the acquisition method of accounting and we finalized the purchase accounting related to the 2020 acquisitions during 2021. As a result of the final purchase accounting, certain of the fair value amounts previously estimated were adjusted during the measurement period. These measurement period adjustments resulted from updated valuation reports and appraisals received from our external valuation specialists, as well as revisions to internal estimates. The measurement period adjustments were not material to the Consolidated Balance Sheet as of March 27, 2021 and March 28, 2020 and the Consolidated Statement of Income and Comprehensive Income for 2021 and 2020.

The acquired assets and liabilities assumed were recorded at their assigned acquisition-date fair values and were consolidated with those of the Company as of the acquisition date. The consideration transferred and net liabilities assumed were recorded as goodwill.

Monro, Inc. 2021 Form 10-K 44

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

2020 Acquisition-date Fair Values Assigned
(thousands)
Inventories	$	4,433
Other current assets		706
Property and equipment		2,405
Finance lease and financing obligation assets, net		29,147
Operating lease assets, net		42,680
Intangible assets		2,847
Other non-current assets		374
Long-term deferred income tax assets		4,870
Total assets acquired		87,462
Current portion of finance leases and financing obligations		2,672
Current portion of operating lease liabilities		4,416
Deferred revenue		1,618
Other current liabilities		358
Long-term finance leases and financing obligations		36,225
Long-term operating lease liabilities		43,668
Other long-term liabilities		1,747
Total liabilities assumed		90,704
Total net identifiable liabilities assumed	$	(3,242)
Total consideration transferred	$	103,692
Less: total net identifiable liabilities assumed		(3,242)
Goodwill	$	106,934

Note 4 – Other Current Assets

Other Current Assets
(thousands)		March 27, 2021		March 28, 2020
Vendor rebates receivable	$	15,068	$	16,232
Other		33,047		24,305
Total	$	48,115	$	40,537

Note 5 – Property and Equipment

The major classifications of property, plant and equipment are as follows:

Property and Equipment
(thousands)		March 27, 2021		March 28, 2020
Land	$	84,485	$	84,765
Buildings and improvements		289,328		272,724
Equipment, signage and fixtures		291,179		278,324
Vehicles		37,684		38,356
Construction-in-progress		7,073		8,763
Property and equipment		709,749		682,932
Less - Accumulated depreciation		382,686		354,295
Property and equipment, net	$	327,063	$	328,637

Depreciation expense totaled $42.9 million, $39.2 million and $35.5 million for 2021, 2020 and 2019, respectively.

Monro, Inc. 2021 Form 10-K 45

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Note 6 – Goodwill and Intangible Assets

Reconciliation of Changes in Goodwill
(thousands)		2021		2020
Balance at beginning of period	$	671,843	$	565,503
Current fiscal year acquisitions		17,677		106,930
Adjustments to prior fiscal year acquisitions		4		(590)
Balance at end of period	$	689,524	$	671,843

Intangible Assets	March 27, 2021				March 28, 2020
		Gross		Accumulated		Gross		Accumulated
(thousands)		Carrying Amount		Amortization		Carrying Amount		Amortization
Customer lists	$	36,000	$	21,932	$	42,511	$	26,333
Trade names		18,452		10,321		21,252		12,072
Franchise agreements		7,100		3,231		7,220		2,805
Other intangible assets		50		50		590		582
Total	$	61,602	$	35,534	$	71,573	$	41,792

Estimated Weighted Average Useful Lives	Life (Years)
Customer lists	10
Trade names	15
Franchise agreements	13
Other intangible assets	20

Amortization expense was $4.1 million, $4.8 million and $5.3 million for 2021, 2020 and 2019, respectively.

Estimated Future Amortization Expense
(thousands)		Amortization
2022	$	3,838
2023		3,583
2024		3,223
2025		2,866
2026		2,646

Note 7 – Long-term Debt

Credit Facility

In April 2019, we entered into a new five year $600 million revolving credit facility agreement with eight banks (the “Credit Facility”). Interest only is payable monthly throughout the Credit Facility’s term. The borrowing capacity for the Credit Facility of $600 million includes an accordion feature permitting us to request an increase in availability of up to an additional $250 million. The Credit Facility bears interest at 75 to 200 basis points over LIBOR (or replacement index) or at the prime rate, depending on the type of borrowing and the rates then in effect.

On June 11, 2020, we entered into a First Amendment to the Credit Facility (the “First Amendment”), which, among other things, amended the terms of certain of the financial and restrictive covenants in the credit agreement through the first quarter of 2022 to provide us with additional flexibility to operate our business. The First Amendment permanently amended the interest rate charged on borrowings to be based on the greater of adjusted one-month LIBOR or 0.75 percent. For the period from June 30, 2020 to June 30, 2021, the minimum interest rate spread charged on borrowings will be 225 basis points over LIBOR. Additionally, during the same period, we may declare, make or pay any dividend or distribution up to $38.5 million in the aggregate and the acquisition of stores or other businesses up to $100 million in the aggregate are permitted if we are in compliance with the financial covenants and other restrictions in the First Amendment and Credit Facility. The Credit Facility requires fees payable quarterly throughout the term between 0.125 percent and 0.35 percent of the amount of the average net availability under the Credit Facility during the preceding quarter. Except as amended by the First Amendment, the remaining terms of the credit agreement remain in full force and effect.

Monro, Inc. 2021 Form 10-K 46

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

At March 27, 2021 and March 28, 2020, the interest rate spread paid by the Company was 225 basis points and 100 basis points over LIBOR, respectively.

Within the Credit Facility, we have a sub-facility of $80 million available for the purpose of issuing standby letters of credit. The sub-facility requires fees aggregating 87.5 to 212.5 basis points annually of the face amount of each standby letter of credit, payable quarterly in arrears. There was a $33.6 million outstanding letter of credit at March 27, 2021.

Mortgages and specific lease financing arrangements with other parties (with certain limitations) are permitted under the Credit Facility. Other specific terms and the maintenance of specified ratios are generally consistent with our prior financing agreement that was replaced with the new agreement entered into in April 2019. Additionally, the Credit Facility is not secured by our real property, although we have agreed not to encumber our real property, with certain permissible exceptions.

There was $190.0 million outstanding and $376.4 million available under the Credit Facility at March 27, 2021.

We were in compliance with all debt covenants at March 27, 2021.

Long-term debt had a carrying amount and a fair value of $190.0 million as of March 27, 2021, as compared to a carrying amount and a fair value of $566.4 million as of March 28, 2020. The carrying value of our debt approximated its fair value due to the variable interest nature of the debt.

Note 8 – Revenue

Automotive undercar repair, tire replacement sales and tire related services represent the vast majority of our revenues. We also earn revenue from the sale of tire road hazard warranty agreements as well as commissions earned from the delivery of tires on behalf of certain tire vendors.

Revenue from automotive undercar repair, tire replacement sales and tire related services is recognized at the time the customers take possession of their vehicle or merchandise. For sales to certain customers that are financed through the offering of credit on account, payment terms are established for customers based on our pre-established credit requirements. Payment terms vary depending on the customer and generally range from 15 to 45 days. Based on the nature of receivables, no significant financing components exist. Sales are recorded net of discounts, sales incentives and rebates, sales taxes and estimated returns and allowances. We estimate the reduction to sales and cost of sales for returns based on current sales levels and our historical return experience. Such amounts are immaterial to our consolidated financial statements.

Revenues
(thousands)		2021		2020		2019
Brakes	$	130,179	$	169,138	$	162,709
Exhaust		20,201		25,058		28,713
Steering		85,290		100,230		95,711
Tires (a)		617,815		634,513		601,295
Maintenance		269,337		324,494		308,668
Other		2,899		3,091		3,134
Total	$	1,125,721	$	1,256,524	$	1,200,230

(a) Includes the sale of tire road hazard warranty agreements and tire delivery commissions.

Revenue from the sale of tire road hazard warranty agreements is initially deferred and is recognized over the contract period as costs are expected to be incurred in performing such services, typically 21 to 36 months. The deferred revenue balances at March 27, 2021 and March 28, 2020 were $16.7 million and $18.5 million, respectively, of which $12.0 million and $13.1 million, respectively, are reported in Deferred revenue and $4.7 million and $5.4 million, respectively, are reported in Other long-term liabilities in our Consolidated Balance Sheets.

Monro, Inc. 2021 Form 10-K 47

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Changes in Deferred Revenue
(thousands)		2021		2020
Balance at beginning of period	$	18,506	$	17,150
Deferral of revenue		14,958		17,466
Deferral of revenue from acquisitions		1,225		2,916
Recognition of revenue		(17,977)		(19,026)
Balance at end of period	$	16,712	$	18,506

We expect to recognize $12.0 million of deferred revenue related to road hazard warranty agreements during our fiscal year ending March 26, 2022, and $4.7 million of such deferred revenue thereafter.

Under various arrangements, we receive from certain tire vendors a delivery commission and reimbursement for the cost of the tire that we may deliver to customers on behalf of the tire vendor. The commission we earn from these transactions is as an agent and the net amount retained is recorded as sales.

Note 9 – Income Taxes

Provision for Income Taxes
(thousands)		2021		2020		2019
Current:
Federal	$	(1,809)	$	2,783	$	5,682
State		827		1,994		2,409
Total current		(982)		4,777		8,091
Deferred:
Federal		10,169		11,397		11,563
State		685		76		954
Total deferred		10,854		11,473		12,517
Total provision	$	9,872	$	16,250	$	20,608

Income Tax Rate Reconciliation	2021		2020		2019
Expected U.S. federal income taxes at statutory rate	21.0	%	21.0	%	21.0	%
State income taxes, net of federal tax benefit	2.9		1.9		2.8
Tax settlements and adjustments (a)	(1.1)		—		(1.9)
Other	(0.5)		(1.0)		(1.4)
Effective tax rate	22.3	%	21.9	%	20.5	%

(a)For 2021, adjustments reflect benefit due to differences in statutory tax rates from loss years to years in which net operating losses may be carried back. For 2019, settlements reflect benefit from Internal Revenue Service’s examination of our 2016 and 2017 tax returns.

Monro, Inc. 2021 Form 10-K 48

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Net Deferred Tax Asset/(Liability)
(thousands)		March 27, 2021		March 28, 2020
Gross deferred tax assets:
Lease liabilities	$	186,168	$	169,366
Insurance reserves		11,441		10,192
Other		15,282		14,765
Total gross deferred tax assets		212,891		194,323
Gross deferred tax liabilities:
Leased assets		(148,496)		(131,484)
Goodwill		(56,623)		(47,204)
Property and equipment		(21,032)		(18,232)
Other		(910)		(1,288)
Total deferred tax liabilities		(227,061)		(198,208)
Total net deferred tax liability	$	(14,170)	$	(3,885)

We have $7.5 million of state net operating loss carryforwards and $3.5 million of federal net operating loss carrybacks available as of March 27, 2021. The state net operating loss carryforwards expire in varying amounts through 2041. The federal net operating loss may be carried back to 2016, as permitted under the CARES Act.

We evaluate the realizability of our deferred tax assets on a quarterly basis and establish valuation allowances when it is more likely than not that all or a portion of a deferred tax asset may not be realized. As of March 27, 2021, we concluded, based on the weight of all available positive and negative evidence, that all of our deferred tax assets are more likely than not to be realized.

Changes in Liability for Unrecognized Tax Benefits
(thousands)		2021		2020		2019
Balance at beginning of period	$	5,212	$	6,424	$	6,209
Additions based on tax positions related to the current year		915		644		1,178
Additions for tax positions of prior years		—		—		166
Reductions for tax positions of prior years		—		(30)		(6)
Settlements		—		—		—
Lapse in statutes of limitation		(1,092)		(1,826)		(1,123)
Balance at end of period	$	5,035	$	5,212	$	6,424

The total amount of unrecognized tax benefits was $5.0 million, $5.2 million and $6.4 million at March 27, 2021, March 28, 2020 and March 30, 2019, respectively, the majority of which, if recognized, would affect the effective tax rate.

In the normal course of business, Monro provides for uncertain tax positions and the related interest and penalties, and adjusts its unrecognized tax benefits and accrued interest and penalties and, accordingly, we had approximately $0.2 million and $0.3 million of interest and penalties associated with uncertain tax benefits accrued as of March 27, 2021 and March 28, 2020, respectively.

We file U.S. federal income tax returns and income tax returns in various state jurisdictions. Monro’s fiscal 2020, 2019 and 2018 U.S. federal tax year and various state tax years remain subject to income tax examinations by tax authorities.

Note 10 – Stock Ownership

Holders of at least 60 percent of the Class C preferred stock must approve any action authorized by the holders of Common Stock. In addition, there are certain restrictions on the transferability of shares of Class C preferred stock. In the event of a liquidation, dissolution or winding-up of Monro, the holders of the Class C preferred stock would be entitled to receive $1.50 per share out of the assets of Monro before any amount would be paid to holders of Common Stock. The conversion value of the Class C convertible preferred stock was $0.064 per share at March 27, 2021 and March 28, 2020.

Monro, Inc. 2021 Form 10-K 49

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Note 11 – Share-based Compensation

We maintain a long-term incentive plan whereby eligible employees and non-employee directors may be granted non-qualified service condition stock options, non-qualified market condition stock options, restricted stock awards and restricted stock units. We grant share-based awards to continue to attract and retain employees and to better align employees’ interests with those of our shareholders. Monro issues new shares of Common Stock upon the exercise of stock options.

Share-based compensation expense included in cost of sales and OSG&A expense in Monro’s Consolidated Statements of Income and Comprehensive Income for 2021, 2020 and 2019 was $2.4 million, $3.8 million and $4.0 million, respectively, and the related income tax benefit for each year was $0.6 million, $0.9 million and $1.0 million, respectively.

Monro currently grants stock option awards and restricted stock under the 2007 Incentive Stock Option Plan (the “2007 Plan”), as amended and restated effective August 2017. At March 27, 2021, there were a total of 5,001,620 shares and 1,064,945 shares that were authorized and available for grant under the 2007 Plan, respectively.

Non-Qualified Stock Options

Generally, employee options vest over a four year period, and have a duration of six years. Outstanding options are exercisable for various periods through March 2027.

Stock Option Activity				Weighted-average
				Remaining
	Stock		Weighted-average	Contractual		Aggregate Intrinsic
	Options		Exercise Price	Term (years)		Value (a)
Outstanding as of March 28, 2020	802,766	$	58.55
Granted	166,193		55.29
Exercised	(130,998)		47.93
Canceled	(324,094)		56.14
Outstanding as of March 27, 2021	513,867	$	61.75	3.12	$	3,483,001
Vested and exercisable as of March 27, 2021	286,549	$	61.30	1.93	$	1,805,603

(a)Total shares valued at the market price of the underlying stock as of March 27, 2021 less the exercise price.

As of March 27, 2021, the total unrecognized compensation expense related to unvested stock option awards was $2.7 million, which is expected to be recognized over a weighted average period of approximately three years. The weighted-average grant date fair value of options granted during 2021, 2020 and 2019 was $12.53, $18.92 and $15.44, respectively. The total fair value of stock options vested during 2021, 2020 and 2019 was $2.0 million, $2.0 million and $2.8 million, respectively.

Stock Option Exercises
(millions)		2021		2020		2019
Total intrinsic value of stock options exercised	$	1.5	$	2.9	$	7.4
Cash received for exercise price		6.3		6.2		14.6
Income tax benefit		—		0.4		1.0

Stock Options Outstanding	Options Outstanding				Options Exercisable
and Exercisable		Weighted-				Weighted-
		average		Weighted-		average		Weighted-
	Shares	Remaining		average	Shares	Remaining		average
	Outstanding	Contractual		Exercise	Exercisable	Contractual		Exercise
Range of Exercise Prices	at 3/27/2021	Term (years)		Price	at 3/27/2021	Term (years)		Price
$40.71 - $55.15	129,817	3.77	$	50.86	53,993	2.35	$	47.88
$55.16 - $57.78	131,696	2.93		56.97	66,393	0.86	$	57.28
$57.79 - $66.90	134,126	2.36		64.38	113,151	2.03	$	64.37
$66.91 - $87.17	118,228	3.49		76.04	53,012	2.62	$	73.44

Monro, Inc. 2021 Form 10-K 50

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Restricted Stock

Monro issues restricted stock to certain members of senior management as well as non-employee directors of the Company. Restricted stock units represent shares issued upon vesting in the future whereas restricted stock awards represent shares issued upon grant that are restricted. The fair value for restricted stock units and restricted stock awards is calculated based on the stock price on the date of grant. Restricted stock units do not have voting rights but earn dividends during the vesting period. The recipients of the restricted stock awards have voting rights and earn dividends during the vesting period. The dividends are paid to the recipient at the time the restricted stock becomes vested. If the recipient leaves Monro prior to the vesting date for any reason, the shares of restricted stock and the dividends accrued on those shares will be forfeited and returned to Monro. The restricted stock units and awards vest equally over three years or four years. In 2020 and 2019, the Company issued a limited number of restricted stock units to members of senior management which may vest upon the achievement of a three year average return on invested capital target.

Subsequent to fiscal 2021, the Company granted 40,000 restricted stock units in connection with the appointment of its new President and Chief Executive Officer effective April 5, 2021. The restricted stock units will vest upon time or the Company’s common stock price meeting certain market conditions between April 2021 and December 2023.

Non-vested Restricted Stock Activity			Weighted-average
	Restricted Stock		Grant-date
	Shares		Fair Value per Share
Outstanding as of March 28, 2020	55,730	$	64.96
Granted	35,019		52.75
Vested	(26,333)		56.52
Forfeited	(12,703)		63.90
Outstanding as of March 27, 2021	51,713	$	61.24

As of March 27, 2021, the total unrecognized compensation expense related to unvested restricted stock shares was $1.4 million, which is expected to be recognized over a weighted average period of approximately two years. The weighted-average grant date fair value of restricted stock shares granted during 2021, 2020 and 2019 was $52.75, $75.33 and $67.80, respectively. The total fair value of restricted stock shares vested during 2021, 2020 and 2019 was $1.4 million, $1.8 million and $1.0 million, respectively.

Note 12 – Earnings per Common Share

Earnings per Common Share
(thousands, except per share data)		2021		2020		2019
Numerator for earnings per common share calculation:
Net income	$	34,319	$	58,024	$	79,752
Less: Preferred stock dividends		(438)		(449)		(408)
Income available to common stockholders	$	33,881	$	57,575	$	79,344
Denominator for earnings per common share calculation:
Weighted average common shares - basic		33,329		33,246		32,980
Effect of dilutive securities:
Preferred stock		503		510		510
Stock options		26		167		154
Restricted stock		18		30		31
Weighted average common shares - diluted		33,876		33,953		33,675
Basic earnings per common share	$	1.02	$	1.73	$	2.41
Diluted earnings per common share	$	1.01	$	1.71	$	2.37

The computation of diluted earnings per common share for 2021, 2020 and 2019 excludes the effect of assumed exercise of approximately 456,000, 177,000 and 146,000 of stock options, respectively, as the exercise price of these options was greater than the average market value of our common stock for those periods, resulting in an anti-dilutive effect on diluted earnings per common share.

Monro, Inc. 2021 Form 10-K 51

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Note 13 – Leases

We lease certain retail stores, distribution centers, office space and land as well as service contracts that are considered leases.

Our leases have remaining lease terms, including renewals reasonably certain to be exercised, of less than one year to approximately 37 years. Most of our leases include one or more options to extend the lease, for periods ranging from three years to 25 years or more.

Historical failed sale leasebacks that were assumed through acquisitions and do not qualify for sale leaseback accounting continue to be accounted for as financing obligations. As of March 27, 2021 and March 28, 2020, net assets of $4.4 million and $4.5 million, respectively, and liabilities of $7.2 million and $7.5 million, respectively, due to failed sale leaseback arrangements were included with finance lease assets and liabilities, respectively, on the Consolidated Balance Sheets.

Lease Cost
(thousands)		2021		2020
Operating lease cost	$	35,998	$	38,525
Finance lease/financing obligations cost:
Amortization of leased assets		30,428		21,033
Interest on lease liabilities		18,344		21,330
Short term and variable lease cost		321		2,194
Sublease income		(95)		(166)
Total lease cost	$	84,996	$	82,916

As reported under the previous accounting standard, net rental expense and amortization of finance lease assets was $38.0 million and $14.7 million, respectively, for 2019.

Maturity of Lease Liabilities				Finance Leases and
(thousands)		Operating Leases (a)		Financing Obligations (b)
2022	$	36,451	$	55,389
2023		34,381		55,487
2024		31,685		54,405
2025		28,414		51,494
2026		25,161		48,992
Thereafter		83,454		250,812
Total undiscounted lease obligations	$	239,546	$	516,579
Less: imputed interest		(30,919)		(112,446)
Present value of lease obligations	$	208,627	$	404,133

(a)Operating lease obligations include $61.0 million related to options to extend operating leases that are reasonably certain of being exercised.

(b)Finance lease payments include $108.4 million related to options to extend finance leases that are reasonably certain of being exercised.

Total lease payments exclude $2.4 million of legally binding minimum lease payments for leases signed but not yet commenced.

Lease Term and Discount Rate	2021		2020
Weighted average remaining lease term (years)
Operating leases	8.6		9.4
Finance leases and financing obligations	10.3		9.9
Weighted average discount rate
Operating leases	2.96	%	3.51	%
Finance leases and financing obligations	6.20	%	8.73	%

Monro, Inc. 2021 Form 10-K 52

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Other Information
(thousands)		2021		2020
Cash paid for amounts included in measurement of lease obligations:
Operating cash flows from operating leases	$	34,931	$	36,808
Operating cash flows from finance leases and financing obligations		18,602		21,340
Financing cash flows from finance leases and financing obligations		33,032		27,212

0

Note 14 – Defined Benefit and Defined Contribution Plans

Defined Benefit Plan

We have a defined benefit pension plan covering employees who meet eligibility requirements. This plan is closed to new participants. Eligibility and the level of benefits under the plan are primarily dependent on date of hire, age, length of service and compensation. The funding policy for our plan is consistent with the funding requirements of U.S. federal law and regulations. The measurement date used to determine the pension plan measurements disclosed herein is March 31 for both 2021 and 2020.

The underfunded status of Monro’s defined benefit plan is recognized as an Other long-term liability in the Consolidated Balance Sheets as of March 27, 2021 and March 28, 2020, respectively.

Underfunded Status
(thousands)		2021		2020
Projected benefit obligations	$	22,096	$	21,646
Fair value of plan assets		21,666		18,611
Underfunded status	$	(430)	$	(3,035)

Contributions and Estimated Future Benefit Payment

Our obligations to plan participants can be met over time through a combination of company contributions to these plans and earnings on plan assets. There are no required or expected contributions in fiscal 2022 to the plan. However, depending on investment performance and plan funded status, we may elect to make a contribution.

Estimated Future Benefit Payments
(thousands)		Pension Benefits
2022	$	1,065
2023		1,098
2024		1,114
2025		1,147
2026		1,188
2027 - 2031		6,322

Cost of Plans

Net Pension Benefits Expense (Income)
(thousands)		2021		2020		2019
Interest cost on projected benefit obligation	$	692	$	752	$	781
Expected return on plan assets		(1,162)		(1,423)		(1,409)
Amortization of unrecognized actuarial loss		892		455		403
Total	$	422	$	(216)	$	(225)

Monro, Inc. 2021 Form 10-K 53

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Assumptions

Benefit Obligation Weighted Average Assumption	2021		2020
Discount rate	3.01	%	3.34	%

Net Periodic Benefit Expense Weighted Average Assumptions	2021		2020		2019
Discount rate	3.34	%	3.72	%	3.89	%
Expected long-term rate of return on plan assets	6.50	%	7.00	%	7.00	%

Our expected long-term rate of return on plan assets assumption is based upon historical returns and the future expectations for returns for each asset class, as well as the target asset allocation of the pension portfolio.

Benefit Obligation

Change in Projected Benefit Obligation
(thousands)		2021		2020
Benefit obligation at beginning of year	$	21,646	$	20,972
Interest cost		692		752
Actuarial loss		391		642
Benefits paid		(633)		(720)
Benefit obligation at end of year (a)	$	22,096	$	21,646

(a) Accumulated benefit obligation-the present value of benefits earned to date assuming no future salary growth-is materially consistent with the projected benefit obligation in each period presented.

Plan Assets

Change in Plan Assets
(thousands)		2021		2020
Fair value of plan assets at beginning of year	$	18,611	$	20,838
Actual return (loss) on plan assets		3,688		(1,507)
Benefits paid		(633)		(720)
Fair value of plan assets at end of year	$	21,666	$	18,611

Our asset allocation strategy is to conservatively manage the assets in order to meet the plan’s long-term obligations while maintaining sufficient liquidity to pay current benefits. This is achieved by holding equity investments while investing a portion of assets in long duration bonds to match the long-term nature of the liabilities.

Asset Category	Current Targeted		Actual Allocation
	Allocation		2021		2020
Cash and cash equivalents			53.3	%	4.1	%
Fixed income	50.0	%	24.7	%	37.9	%
Equity securities	50.0	%	22.0	%	58.0	%
Total	100.0	%	100.0	%	100.0	%

The allocation of assets as of March 2021 was weighted heavier in cash and cash equivalents as the Plan’s assets were transferred from its previous custodian to a new custodian late in 2021 by the Plan’s new asset manager. As such, cash and cash equivalent assets were being reinvested into new assets in accordance with our asset allocation strategy late in fiscal 2021 and into 2022.

Monro, Inc. 2021 Form 10-K 54

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Fair Value Measurements		Fair Value at
(thousands)	Pricing Category (a)		March 27, 2021		March 28, 2020
Cash equivalents	Level 1	$	11,542	$	761
Equity securities:
U.S. companies	Level 1		3,372		7,383
U.S. companies	Level 2		—		283
International companies	Level 1		1,391		3,137
Fixed income:
U.S. corporate bonds	Level 2		5,361		6,686
International bonds	Level 2		—		361
Total plan assets		$	21,666	$	18,611

(a) Fair value measurements are reported in one of three levels based on the lowest level of significant input used: Level 1 (unadjusted quoted prices in active markets); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data).

Amounts included in Shareholders’ Equity

Amounts in Accumulated Other Comprehensive Loss
(thousands)		2021		2020
Unamortized net actuarial loss	$	6,147	$	9,174
Amounts in Accumulated Other Comprehensive Loss (a)	$	6,147	$	9,174

(a) $4,619 and $6,889, net of tax, at the end of 2021 and 2020, respectively.

Amounts included in Comprehensive Income

Amounts in Other Comprehensive Income (Loss)
(thousands)		2021		2020		2019
Net actuarial income (loss)	$	3,027	$	(3,117)	$	(382)
Amounts in Other Comprehensive Income (Loss) (a)	$	3,027	$	(3,117)	$	(382)

(a) $2,270, ($2,353) and ($288), net of tax, during 2021, 2020 and 2019, respectively.

Defined Contribution Plan

Our employees are eligible to participate in a defined contribution 401(k) plan that covers full-time employees who meet the age and service requirements of the plan. The plan is funded by employee and employer contributions. We match 50 percent of the first 6 percent of employee contributions. Employer contributions totaled approximately $1.6 million, $1.7 million and $1.4 million for 2021, 2020 and 2019, respectively. We may also make annual profit sharing contributions to the plan at the discretion of Monro’s Compensation Committee of the Board of Directors.

In addition, we maintain a deferred compensation plan (the “Deferred Compensation Plan”) for a broad management group whose participation in our 401(k) plan is limited by statute or regulation. The Deferred Compensation Plan permits participants to defer all or any portion of the compensation that would otherwise be payable to them for the calendar year. We credit to the participants’ accounts such amounts as would have been contributed to Monro’s 401(k) plan but for the limitations that are imposed by statute or regulation. The Deferred Compensation Plan is an unfunded arrangement and the participants or their beneficiaries have an unsecured claim against the general assets of Monro to the extent of their Deferred Compensation Plan benefits. We maintain accounts to reflect the amounts owed to each participant. At least annually, the accounts are credited with earnings or losses calculated on the basis of an interest rate or other formula as determined by Monro’s Compensation Committee. The total liability recorded in our financial statements at March 27, 2021 and March 28, 2020 related to the Deferred Compensation Plan was approximately $2.1 million and $2.2 million, respectively.

Monro, Inc. 2021 Form 10-K 55

CONSOLIDATED FINANCIAL STATEMENTS

NOTES

Note 15 – Commitments and Contingencies

Commitments

Commitments Due by Period				Within		2 to		4 to		After
(thousands)		Total		1 Year		3 Years		5 Years		5 Years
Principal payments on long-term debt	$	190,000					$	190,000
Finance lease commitments/financing obligations (a)		516,579	$	55,389	$	109,892		100,486	$	250,812
Operating lease commitments (a)		239,546		36,451		66,066		53,575		83,454
Accrued rent		1,807		1,563		132		42		70
Other liabilities		1,133		800		333		—		—
Total	$	949,065	$	94,203	$	176,423	$	344,103	$	334,336

(a) Finance and operating lease commitments represent future undiscounted lease payments and include $108.4 million and $61.0 million, respectively, related to options to extend lease terms that are reasonably certain of being exercised.

During 2021, we negotiated rent deferrals, with repayment at later dates, for a significant number of our store leases. These concessions provide a deferral of rent payments with no substantive changes to the original contract. Consistent with updated guidance from the FASB in April 2020, we have elected to treat the rent deferrals as accrued liabilities. The accrued rent reflected in the table above includes $0.8 million related to rent deferrals due primarily in the first and second quarter of 2022 and $1.0 million due to timing of other lease related expenses. We will continue to recognize expense during the deferral periods.

In addition, during 2021, we negotiated rent reductions with certain landlords on approximately 23 percent of our lease contracts in exchange for extending our current lease term. As these agreements represent substantive changes to our contractual obligations, the leases were remeasured. As a result, finance lease and financing obligation assets, net and finance leases and financing obligations were increased by $67.7 million and $64.0 million, respectively, and operating lease assets, net and operating lease liabilities were increased by $16.2 million and $20.0 million, respectively. The negotiated terms were generally consistent with terms of normal renewal agreements.

We believe that we can fulfill our commitments utilizing our cash flow from operations and, if necessary, cash on hand and/or bank financing.

Contingencies

We are currently a party to various claims and legal proceedings incidental to the conduct of our business. If management believes that a loss arising from any of these matters is probable and can reasonably be estimated, we will record the amount of the loss, or the minimum estimated liability when the loss is estimated using a range, and no point within the range is more probable than another. As additional information becomes available, any potential liability related to these matters is assessed and the estimates are revised, if necessary. Litigation is subject to inherent uncertainties, and unfavorable rulings could occur and may include monetary damages. If an unfavorable ruling were to occur, there exists the possibility of a material adverse impact on the financial position and results of operations of the period in which any such ruling occurs, or in future periods.

As disclosed in Part I, Item 3, “Legal Proceedings,” an action has been brought against us by an individual seeking to represent a putative class of store managers for unpaid overtime wages, damages and attorneys’ fees under the Fair Labor Standards Act and class certification under Pennsylvania law for alleged violations of state wage payment laws. Plaintiff alleges that improper deductions were made from store managers’ pay.

Note 16 – Subsequent Events

On April 5, 2021, Michael T. Broderick joined Monro as President and Chief Executive Officer. See Note 11 for a discussion of restricted stock units granted subsequent to March 27, 2021.

In May 2021, Monro’s Board of Directors declared a cash dividend of $0.24 per share or share equivalent to be paid to shareholders of record as of June 7, 2021. The dividend will be paid on June 21, 2021.

See Note 3 for a discussion of an acquisition subsequent to March 27, 2021.

Monro, Inc. 2021 Form 10-K 56

SUPPLEMENTAL INFORMATION

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Disclosure Controls and Procedures

Disclosure controls and procedures are designed with the objective of ensuring that information required to be disclosed in the Company’s reports filed under the Exchange Act, such as this report, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures are also designed with the objective of ensuring that such information is accumulated and communicated to the Company’s management, including the Company’s principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s principal executive officer and principal financial officer, of the effectiveness of disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Based on such evaluation, the Company’s principal executive officer and principal financial officer have concluded that as of March 27, 2021, the end of the period covered by this report, the Company’s disclosure controls and procedures were effective.

Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting. Monro’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States of America. Management conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that Monro’s internal control over financial reporting was effective as of March 27, 2021, the end of our fiscal year. The effectiveness of Monro’s internal control over financial reporting as of March 27, 2021 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein. For the Report on Management’s Assessment of Internal Control Over Financial Reporting and the Report of Independent Registered Public Accounting Firm, see Part II, Item 8, “Financial Statements and Supplementary Data”.

Changes in Internal Control Over Financial Reporting

The Company also carried out an evaluation of the internal control over financial reporting to determine whether any changes occurred during the fiscal quarter ended March 27, 2021. Based on such evaluation, there have been no changes in the Company’s internal control over financial reporting that occurred during the Company’s most recently completed fiscal quarter ended March 27, 2021, that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Item 9B. Other Information

In March 2021, the Company changed benefit plan administrators for the Monro, Inc. 401(k) Plan, and from March 25 to April 14, 2021, plan participants were temporarily unable to move money between funds, change the funds in which the participant invests, or request withdrawals or distributions. Beginning February 25, 2021, the Company’s officers and directors were also prohibited from transacting in the Company’s common stock pursuant to our Insider Trading Policy.

On January 22, 2021, Donna G. Maxwell resigned from her position as Senior Vice President – Chief Human Resource Officer.

Monro, Inc. 2021 Form 10-K 57

SUPPLEMENTAL INFORMATION

PART III

Certain information required by Part III is incorporated by reference from Monro’s Definitive Proxy Statement for its 2021 Annual Meeting of Shareholders to be held on August 17, 2021 (“Proxy Statement”).

Item 10. Directors, Executive Officers and Corporate Governance

The following sections of the Proxy Statement are incorporated herein by reference:

Proposal No. 1 – Election of Directors

Corporate Governance Practices and Policies

Our Executive Officers

Delinquent Section 16(a) Reports

Monro’s directors and executive officers are subject to the provisions of Monro’s Code of Ethics for All Board Members, Executive Officers and Management Teammates (the “Code”), which is available in the Investor Information section of Monro’s website, https://corporate.monro.com/investors. Changes to the Code and any waivers are also posted on Monro’s website in the Investor Information section.

Item 11. Executive Compensation

The following sections of the Proxy Statement are incorporated herein by reference:

Proposal No. 2 – Advisory Vote to Approve Executive Compensation

Executive Compensation

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The following sections of the Proxy Statement are incorporated herein by reference:

Security Ownership of Certified Beneficial Owners and Management

Information concerning Monro’s shares authorized for issuance under its equity-based compensation plans at March 27, 2021 is incorporated herein by reference to the section captioned “Executive Compensation – Equity Compensation Plan Information” in the Proxy Statement.

Item 13. Certain Relationships and Related Transactions, and Director Independence

The following sub-sections within the Corporate Governance Practices and Policies section of the Proxy Statement are incorporated herein by reference:

Board and Committee Independence

Certain Relationships and Related Party Transactions

Item 14. Principal Accountant Fees and Services

The following sections of the Proxy Statement are incorporated herein by reference:

Proposal No. 3 – Ratification of Appointment of Independent Registered Public Accounting Firm

‎

Monro, Inc. 2021 Form 10-K 58

SUPPLEMENTAL INFORMATION

PART IV

Item 15. Exhibits and Financial Statement Schedules

The following information required under this item is filed as part of this report:

(a)Financial Statements

oConsolidated Balance Sheets as of March 27, 2021 and March 28, 2020

oConsolidated Statements of Income and Comprehensive Income for the Years Ended March 27, 2021, March 28, 2020 and March 30, 2019

oConsolidated Statements of Changes in Shareholders’ Equity for the Years Ended March 27, 2021, March 28, 2020 and March 30, 2019

oConsolidated Statements of Cash Flows for the Years Ended March 27, 2021, March 28, 2020 and March 30, 2019

oNotes to Consolidated Financial Statements

oReport of Independent Registered Public Accounting Firm

Financial Statement Schedules

None.

Other schedules have not been included either because they are not applicable or because the information is included elsewhere in this Report.

‎

Monro, Inc. 2021 Form 10-K 59

SUPPLEMENTAL INFORMATION

(b)Exhibits

Exhibit No.	Document
3.01	Restated Certificate of Incorporation of the Company, dated July 23, 1991, with Certificate of Amendment, dated November 1, 1991. (Filed in paper form as SEC File No: 0-19357, 1992 Form 10-K, Exhibit No. 3.01)
3.01a	Certificate of Change of the Certificate of Incorporation of the Company, dated January 26, 1996. (August 2004 Form S-3, Exhibit No. 4.1(b))
3.01b	Certificate of Amendment to Restated Certificate of Incorporation, dated April 15, 2004. (August 2004 Form S-3, Exhibit No. 4.1(c))
3.01c	Certificate of Amendment to Restated Certificate of Incorporation, dated October 10, 2007. (2008 Form 10-K, Exhibit No. 3.01c)
3.01d	Certificate of Amendment to Restated Certificate of Incorporation, dated August 1, 2012. (2013 Form 10-K, Exhibit No. 3.01d)
3.01e	Certificate of Amendment to Restated Certificate of Incorporation, dated August 15, 2017. (August 2017 Form 8-K, Exhibit No. 3.01e)
3.02	Amended and Restated By-Laws of the Company, dated May 13, 2021. (May 2021 Form 8-K, Exhibit No. 3.02)
4.01	Description of Registrant’s Securities (2019 Form 10-K, Exhibit No. 4.01)
10.01	2007 Stock Incentive Plan, effective as of June 29, 2007. (May 2008 Form S-8, Exhibit No. 4)*
10.01a	Amendment No. 1 to the 2007 Stock Incentive Plan, dated August 9, 2007. (May 2008 Form S-8, Exhibit No. 4.1)*
10.01b	Amendment No. 2 to the 2007 Stock Incentive Plan, dated September 27, 2007. (May 2008 Form S-8, Exhibit No. 4.2)*
10.01c	Amendment No. 3 to the 2007 Stock Incentive Plan, dated August 10, 2010. (August 2010 Form 8-K, Exhibit No. 10.1)*
10.01d	Amendment No. 4 to the 2007 Stock Incentive Plan, dated May 16, 2012. (2012 Form 10-K, Exhibit No. 10.01d)*
10.01e	Amendment No. 5 to the 2007 Stock Incentive Plan, dated June 28, 2013. (2013 Proxy, Exhibit A)*
10.01f	Amendment No. 6 to the 2007 Stock Incentive Plan, dated June 28, 2013. (2014 Form 10-K, Exhibit No. 10.01f)*
10.02	Amended and Restated 2007 Stock Incentive Plan, dated effective August 15, 2017. (2017 Proxy, Exhibit A)*
10.03	Monro Muffler Brake, Inc. Deferred Compensation Plan, dated January 1, 2005, and last amended and restated as of January 1, 2015. (2015 Form 10-K, Exhibit No. 10.03)*
10.04	Monro Muffler Brake, Inc. Retirement Plan, adopted February 1, 1972, and last amended and restated as of April 1, 2013. (2014 Form 10-K, Exhibit No. 10.04)*
10.04a	Amendment No. 1 to April 1, 2013 Restatement to Monro Muffler Brake, Inc. Retirement Plan, dated as of October 27, 2014 and effective as of June 26, 2013. (December 2015 Form 10-Q, Exhibit No. 10.04a)*
10.04b	Amendment No. 2 to April 1, 2013 Restatement to Monro Muffler Brake, Inc. Retirement Plan, dated as of December 10, 2015 and effective as of April 1, 2015. (December 2015 Form 10-Q, Exhibit No. 10.04b)*
10.04c	Amendment No. 3 to April 1, 2013 Restatement to Monro Muffler Brake, Inc. Retirement Plan, dated as of January 30, 2017 and effective as of April 1, 2016. (2017 Form 10-K, Exhibit No. 10.04c)*
10.05	Monro Muffler Brake, Inc. Profit Sharing Plan, adopted May 1, 1960, and last amended and restated as of December 8, 2014. (2015 Form 10-K, Exhibit No. 10.05)*
10.05a	First Amendment to December 8, 2014 Restatement to the Monro Muffler Brake, Inc. Profit Sharing Plan, dated December 10, 2015 and effective as of April 1, 2015. (December 2015 Form 10-Q, Exhibit No. 10.05a)*
10.19	Security Agreement, dated as of January 25, 2016, by and among the Company, Monro Service Corporation, Car-X, LLC and Citizens Bank, N.A., as Administrative Agent for the lenders party to the Credit Agreement. (December 2015 Form 10-Q, Exhibit No. 10.19)
10.20	Guaranty, dated as of January 25, 2016, of Car-X, LLC and Monro Service Corporation. (December 2015 Form 10-Q, Exhibit No. 10.20)
10.21	Negative Pledge Agreement, dated as of January 25, 2016, by and among the Company, Monro Service Corporation, Car-X, LLC and Citizens Bank, N.A., as Administrative Agent for the lenders party to the Credit Agreement. (December 2015 Form 10-Q, Exhibit No. 10.21)
10.22	Amended Credit Agreement, dated as of April 25, 2019 (April 2019 Form 8-K, Exhibit No. 10.22)
10.22a	Amendment No.1 to Amended and Restated Credit Agreement, dated as of June 11, 2020 (June 2020 Form 8-K, Exhibit No. 10.22a)
10.60	Lease Agreement, dated as of November 1, 2011, between Monro Service Corporation and the County of Monroe Industrial Development Agency. (2012 Form 10-K, Exhibit No. 10.60)
10.61	Leaseback Agreement, dated November 1, 2011, between the County of Monroe Industrial Development Agency and Monro Service Corporation. (2012 Form 10-K, Exhibit No. 10.61)
10.67	Letter agreement, effective April 15, 2021, between the Company and Maureen Mulholland. (April 2021 Form 8-K, Exhibit No. 10.67)*
10.68	Employment Agreement by and between the Company and Brian J. D’Ambrosia, dated December 21, 2020. (December 2020 Form 8-K, Exhibit No. 10.67)*

Monro, Inc. 2021 Form 10-K 60

SUPPLEMENTAL INFORMATION

Exhibit No.	Document
10.69	Letter Agreement, effective September 30, 2019, between the Company and Robert Rajkowski. (September 2019 Form 10-Q, Exhibit No. 10.69)*
10.70	Employment Agreement, dated June 28, 2017 and effective August 1, 2017, between the Company and Brett T. Ponton. (June 2017 Form 10-Q, Exhibit No. 10.70)*
10.71	Employment Agreement by and between the Company and Michael T. Broderick, dated March 12, 2021.*
10.73†	Supply Agreement, dated as of November 4, 2020, between Monro Service Corporation, MNRO Service Holdings, LLC and Valvoline LLC. (November 2020 Form 10-Q, Exhibit No. 10.73)
10.77	Monro Muffler Brake, Inc. Management Incentive Compensation Plan, effective as of June 1, 2002. (2002 Form 10-K, Exhibit No. 10.77)*
21.01	Subsidiaries of the Company.
23.01	Consent of PricewaterhouseCoopers LLP.
24.01	Powers of Attorney.
31.1	Certification of Michael T. Broderick, President and Chief Executive Officer.
31.2	Certification of Brian J. D’Ambrosia, Executive Vice President – Finance and Chief Financial Officer.
32.1	Certification Pursuant to 18 U.S.C. Section 1350 (Section 906 of the Sarbanes-Oxley Act of 2002).
101.INS	XBRL Instance Document
101.LAB	XBRL Taxonomy Extension Label Linkbase
101.PRE	XBRL Taxonomy Extension Presentation Linkbase
101.SCH	XBRL Taxonomy Extension Schema Linkbase
101.DEF	XBRL Taxonomy Extension Definition Linkbase
101.CAL	XBRL Taxonomy Extension Calculation Linkbase
104	Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

*	Management contract or compensatory plan or arrangement.
†	Certain portions of this exhibit have been omitted (indicated by asterisks) pursuant to Item 601(b) of Regulation S-K of the Securities Act of 1933, as amended, because such omitted information is (i) not material and (ii) would be competitively harmful if publicly disclosed.

Item 16. Form 10-K Summary

None.

‎

Monro, Inc. 2021 Form 10-K 61

SUPPLEMENTAL INFORMATION

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	MONRO, INC.
By:	/s/ Michael T. Broderick
	Michael T. Broderick
	Chief Executive Officer and President

Date: May 26, 2021

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.

Signature	Title	Date
/s/ Michael T. Broderick	President and Chief Executive Officer	May 26, 2021
Michael T. Broderick	(Principal Executive Officer)
/s/ Brian J. D’Ambrosia	Executive Vice President – Finance,	May 26, 2021
Brian J. D’Ambrosia	Chief Financial Officer and Treasurer
	(Principal Financial Officer and
	Principal Accounting Officer)
/s/ Robert E. Mellor*	Chairman of the Board, Director	May 26, 2021
Robert E. Mellor
/s/ John L. Auerbach*	Director	May 26, 2021
John L. Auerbach
/s/ Frederick M. Danziger*	Director	May 26, 2021
Frederick M. Danziger
/s/ Donald Glickman*	Director	May 26, 2021
Donald Glickman
/s/ Lindsay N. Hyde*	Director	May 26, 2021
Lindsay N. Hyde
/s/ Leah C. Johnson*	Director	May 26, 2021
Leah C. Johnson
/s/ Stephen C. McCluski*	Director	May 26, 2021
Stephen C. McCluski
/s/ Peter J. Solomon*	Director	May 26, 2021
Peter J. Solomon
	* By: /s/ Michael T. Broderick
	Michael T. Broderick, as Attorney-in-Fact

Monro, Inc. 2021 Form 10-K 62

EX-10.71

Exhibit 10.71

EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT, entered into on March 12, 2021 and effective as of the Start Date (as defined below) (the “Effective Date”), between Monro, Inc. (the “Company”) and Michael Broderick (the “Executive”).

WHEREAS, the Company wishes to appoint the Executive as its President and Chief Executive Officer effective as of the Effective Date, and the Executive wishes to serve in that capacity; and

WHEREAS, the Company and the Executive wish for the Executive to be employed by the Company upon the terms and conditions as set forth herein commencing on the Effective Date;

NOW, THEREFORE, in consideration of the mutual covenants and promises herein contained, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.Employment and Duties.

1.1Employment by the Company.  The Company hereby agrees to employ the Executive for the Term (as herein defined), to render exclusive and full-time services in the capacities of President and Chief Executive Officer of the Company, subject to the control and direction of the Company’s Board of Directors (the “Board”).  In addition, while Executive serves as President and Chief Executive Officer, he shall be nominated and recommended to shareholders to serve as a member of the Board.

1.2Duties/Authority.  During the Term, the Executive shall have responsibility for the conduct of the business and fiscal affairs of the Company and the general supervision of and control over the assets, business interests, and agents of the Company, in each case subject to the control and direction of the Board.  The Executive’s duties hereunder shall be consistent with the duties, responsibilities, and authority generally incident to the positions of President and Chief Executive Officer and such other reasonably related duties as may be assigned to him from time to time by the Board consistent with his role as a senior executive.

1.3Principal Place of Employment.  The Executive’s principal place of employment shall be at the Company’s headquarters in Rochester, New York, subject to customary travel. 

2.Term of Employment.  The “Term” of this Agreement shall commence on a date to be mutually agreed by the parties, but in no event later than April 1, 2021 (the “Start Date”) and end on December 31, 2023 (the “Initial Term”), unless sooner terminated as provided herein.   Unless earlier terminated, the Term shall automatically renew (each a “Renewal Term”) at the end of the Initial Term and on each anniversary thereafter for a period of one (1) year unless either party shall give written notice of intent not to extend the then-current Term to the other party not later than ninety (90) days prior to the end of then-current Term.  References herein to the Term shall mean the period of the Executive’s employment during the Initial Term and any Renewal Term. 

3.Compensation.

3.1Salary.  As consideration for services rendered, the Company shall pay the Executive a salary of $700,000 per annum (the “Base Salary”), payable not less frequently than monthly.  The Executive’s Base Salary will be reviewed annually by the Compensation Committee of the Board (the “Committee”) and may be increased (but not decreased without the Executive’s consent) to reflect the Executive’s performance and responsibilities.

3.2Annual Bonus.  Pursuant to the Company’s bonus plan (the “Bonus Plan”), the Company shall pay the Executive, within 120 days of its fiscal year-end, a cash bonus in respect of each prior fiscal year during the Term, of 75% of the Base Salary if the company achieves its threshold performance levels and 100% of the Base Salary if the Company achieves its target level of performance set by the Committee with respect to such fiscal year, increased up to a maximum of 150% of the Base Salary if the Company exceeds such performance

targets by amounts to be determined by the Committee (the “Annual Bonus”).  For 2021, the Annual Bonus shall be no less than $560,000 (i.e., 80% of the target Annual Bonus).  If this Agreement terminates other than at the end of a fiscal year either:  (i) upon the expiration of the Term; or (ii) pursuant to Section 4, and the Executive is entitled to a pro rata bonus for such partial fiscal year pursuant to Section 5 or Section 6 hereof, such pro rata bonus shall be equal to the bonus the Executive would have received under the Bonus Plan, based on the Company’s actual performance during such fiscal year, had he been employed by the Company for the entire fiscal year, multiplied by a fraction, the numerator of which shall be the number of days during such fiscal year he was so employed and the denominator of which shall be the number of days in such fiscal year (the “Pro Rata Bonus”).  The Executive may be entitled to the Annual Bonus for the fiscal year prior to the fiscal year in which the Executive’s employment is terminated, to the extent not yet paid (the “Preceding Bonus”).  The Executive shall be entitled to receive the Preceding Bonus and/or the Pro Rata Bonus, as applicable:  (a) at the same time the annual bonuses for the same periods are paid to other senior executives of the Company; and (b) only to the extent the Board or the Committee determines to pay such bonus to the other senior executives of the Company.  The Annual Bonus shall, in all respects, be subject to the terms of the Bonus Plan.

3.3Participation in Employee Benefit Plans.  The Executive shall be permitted during the Term, if and to the extent eligible, to participate in any group life, hospitalization or disability insurance plan, health program, or any pension plan or similar benefit plan of the Company, which is available generally to other senior executives of the Company.

3.4Equity Awards. 

(A)Sign-On Grant.   Effective as of the Effective Date, the Company shall grant the Executive 40,000 restricted stock units (“RSUs”).  The RSUs shall vest in four equal increments as follows, subject to the Executive’s continued employment with the Company through the applicable vesting date:  (i) 25% on the first anniversary of the Effective Date; (ii) 25% on the second anniversary of the Effective Date; (iii) 25% on such date that, during the Initial Term, the average closing price of the Company’s common stock is $75 or more over thirty (30) consecutive trading days; and (iv) 25% on such date that, during the Initial Term, the average closing price of the Company’s common stock is $85 or more over thirty (30) consecutive trading days; provided that, if the Executive’s employment is terminated by the Company without Cause or the Executive resigns with Good Reason, any unvested RSUs described in clauses (i) and (ii) shall vest on the date of such termination, subject to the release of claims requirement in Section 5.4 or Section 6.2, as applicable.  The RSUs shall be granted pursuant to the Company’s 2007 Stock Incentive Plan and the standard form of restricted stock unit agreement thereunder (as modified to reflect this Section 3.4(A). 

(B)Annual Grants.  During the Term, the Executive shall be eligible to receive annual equity incentive awards with a target value of $400,000 in a combination of awards on a basis comparable to such awards made to other senior executives of the Company, as determined by the Committee; provided that, for the grants made in 2021 for the fiscal year ending in March 2022, at least fifty percent (50%) of such grant shall consist of nonqualified stock options. 

3.5Expenses.  Subject to such policies generally applicable to senior executives of the Company, as may from time to time be established by the Board, the Company shall pay or reimburse the Executive for all reasonable expenses (including travel expenses) actually incurred or paid by the Executive during the Term in the performance of the Executive’s services under this Agreement (“Expenses”) upon presentation of expense statements or vouchers or such other supporting information as it may require.  In addition, for up to two (2) years following the Effective Date or such longer period as agreed by the parties, the Company shall pay Executive’s reasonable travel expenses for his travel from his home to the Company’s offices in Rochester, New York, subject to the Company’s standard expense reimbursement policies, and shall provide Executive an apartment in Rochester, New York.

3.6Vacation.  During the Term, the Executive shall be entitled to such amount of vacation which is available generally to other senior executives of the Company.

3.7Additional Benefits.  During the Term, the Executive shall be entitled to the use of an automobile comparable to that provided to other senior executives in connection with the rendering of services to the Company pursuant to this Agreement, together with reimbursement for all gas, maintenance, insurance and repairs required by reason of his use of such vehicle.

3.8Controlling Document.  To the extent there is any inconsistency between the terms of this Agreement and the terms of any plan or program under which compensation or benefits are provided hereunder, this Agreement shall control.  Otherwise, the Executive shall be subject to the terms, conditions and provisions of the Company’s plans and programs, as applicable.

3.8Indemnification/Insurance.  The Company agrees to indemnify, defend and hold the Executive harmless pursuant to the Company’s governing documents against any and all losses, judgments, liabilities, claims, fines and amounts paid in settlement of, and expenses (including attorneys’ fees and expenses) incurred by him in connection with any claim in connection with or arising out of the Executive’s service as an officer or director to the Company or any of its subsidiaries or affiliates (and the service at the request of the Company as a director, officer, member, employee, or agent of another corporation or a partnership, joint venture, trust, or other enterprise), and the defense of any action or proceeding (or any appeal therefrom) in which he is a party by reason of the fact that the Executive is or was an officer or director of the Company, but in all events excluding the Executive’s fraud or intentional misconduct.  To the extent provided by its policies, the Company agrees to advance all of the Executive’s reasonable attorneys’ fees, costs and expenses of independent counsel selected by and representing the Executive in connection with any such action or proceeding, provided that such selection shall be subject to the Company’s written consent (which shall not be unreasonably withheld).  The Executive shall promptly repay any such advance if there is a final determination by a court that the Executive was not entitled to indemnification in connection therewith.  Without limiting the foregoing, the Company agrees that it shall maintain directors’ and officers’ and errors and omissions liability insurance, which insurance shall cover the Executive during the Term and following the termination thereof for any or no reason for a period of not less than six (6) years, on the same basis as such coverage is provided to the Company’s directors and other executive officers.

3.9Clawback Policy.  The Executive agrees and acknowledges that all compensation paid to him shall be subject to any applicable clawback/recoupment policy adopted by the Board or the Compensation Committee. 

4.Termination or Removal from Duties.

4.1Termination Upon Death.  This Agreement shall terminate automatically upon the Executive’s death.

4.2Removal from Position Upon Disability.  If during the Term, as a result of a physical or mental incapacity or infirmity, the Executive is unable to perform the essential functions of his job with or without reasonable accommodation for a period or periods aggregating 90 days during any 12-month period, the Executive shall be deemed disabled (his “Disability”) and the Company, by written notice to the Executive, shall have the right to remove him from his position.  The Executive’s status as an inactive employee of the Company shall continue after such removal for the period of time that his Disability continues.  However, the Company shall have no obligation to reinstate or otherwise continue the Executive’s employment if he should recover from his Disability and any such termination shall not constitute a termination without Cause or without Good Reason (as herein defined).  The existence of his Disability shall be determined by a reputable, licensed physician selected by the Company in good faith, whose determination shall be final and binding on the parties.

4.3Termination for Cause.  The Company may at any time, by written notice to the Executive, terminate the Executive’s employment hereunder for Cause.  For purposes hereof, the term “Cause” shall mean:  (A) the Executive’s conviction of or pleading guilty or no contest to a felony; (B) failure or refusal of the Executive in any material respect (i) to perform the duties of his employment or to follow the lawful and proper directives of

the Board, provided such duties or directives are consistent with this Agreement and such duties or directives have been given to the Executive in writing, or (ii) to comply with the reasonable and substantial written policies, practices, standards or regulations of the Company (so long as same are not inconsistent with this Agreement) as may be established from time to time, if such failure or refusal under either clause (i) or clause (ii) continues uncured for a period of ten days after written notice thereof, specifying the nature of such failure or refusal and requesting that it be cured, is given by the Company to the Executive; (C) any willful or intentional act of the Executive committed for the purpose, or having the reasonably foreseeable effect, of injuring the Company, its business or reputation or of improperly or unlawfully converting for the Executive’s own personal benefit any property of the Company; or (D) any violation or breach of the provisions of Section 7 of this Agreement.  For the avoidance of doubt, the Company’s failure to attain operating or other goals shall not be grounds for a termination for “Cause”.

4.4Termination without Cause.  The Company may terminate the Executive’s employment without Cause at any time.

4.5Termination with or without Good Reason.  With 45 days’ prior written notice to the Company, this Agreement and the Executive’s employment hereunder may be terminated by the Executive with or without Good Reason.  For purposes of this Agreement, “Good Reason” means if the Executive is able to document, to the reasonable satisfaction of the Company’s outside counsel, that the reason for such resignation is as a direct result of either:  (i) the Company’s material breach of this Agreement; or (ii) the Board requiring the Executive to act, or omit to act, in a way that the Executive reasonably believes is illegal; provided, however, that a termination by the Executive for Good Reason pursuant to (i) or (ii) shall be effective only if, within 30 days following the delivery of written notice of a termination for Good Reason by Executive to the Company, the Company has failed to cure the circumstances giving rise to the Good Reason.  The written notice of termination for Good Reason must specify in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, if applicable.  Any resignation or termination pursuant to the terms of this Section shall not constitute a breach of this Agreement by either party.

5.Rights and Obligations of the Company and the Executive Upon Termination, or Removal.  Other provisions of this Agreement notwithstanding, and except as otherwise provided by Section 6 hereof, upon the occurrence of an event described in Section 4, the parties shall have the following rights and obligations:

5.1Death.  If the Executive’s employment is terminated during the Term by reason of the Executive’s death, the Company shall pay the Executive’s estate in one lump sum amount, one year’s Base Salary (as in effect as of the date of termination) payable on the six-month anniversary of the date of the Executive’s death; plus (B) any Preceding and/or Pro Rata Bonus to which the Executive is entitled, which shall be paid in accordance with Section 3.2.  Any outstanding equity awards shall be treated as specified in the applicable equity plan and award agreement.

5.2Disability.

(A)If the Executive is removed from his position during the Term because of a Disability, the Executive, for the period of time during which his Disability continues, may continue to participate in certain of the employee benefit plans in which he participated immediately prior to his removal.  These benefits would include participation in, as applicable and to the extent defined in the Company’s applicable plans, group life, medical/dental and disability insurance plans, each at the same ratio of employer/employee contribution as applicable to the Executive immediately prior to his removal; and, thereafter, at the same ratio of employer/employee contribution as then-applicable to other executive-level employees in the Company.  In addition, the Executive shall be entitled to compensation and benefits accrued through the date of his removal from his duties, including any amounts payable to the Executive under any Company profit sharing or other employee benefit plan up to the date of removal, to the extent permitted under the terms of such plan.  For avoidance of doubt, the payment of any bonus to which the Executive may be entitled for the period of time up to the date of

his removal pursuant to Section 4.2 hereof, would be paid pursuant to Section 5.2(B), below.  However, the Executive’s rights to bonuses and fringe benefits accruing after his removal, if any, shall cease upon such removal; provided, however, that nothing contained in this Agreement is intended to limit or otherwise restrict the availability of any benefits to the Executive required to be provided pursuant to Section 4980B of the Code.

(B)If the Executive is removed from his position during the Term because of a Disability, the Executive shall be entitled to payments equal to one year’s Base Salary (as in effect as of the date of removal) payable as continued payment of Base Salary (payable in accordance with the Company’s payroll practice); plus (ii) any Preceding and/or Pro Rata Bonus to which the Executive is entitled (payable in accordance with Section 3.2).  Any outstanding equity awards shall be treated as specified in the applicable equity plan and award agreement.

5.3Termination for Cause or without Good Reason.  If the Executive’s employment shall be terminated during the Term (A) by the Company for Cause, or (B) by the Executive without Good Reason, the Company shall pay to the Executive his Base Salary through the date of termination at the rate then in effect and shall reimburse the Executive for any Expenses incurred but not yet paid and shall have no further obligations to the Executive under this Agreement.

5.4Termination without Cause or with Good Reason; Termination Due to Nonrenewal by the Company.  If the Executive’s employment is terminated (A) during the Term (x) by the Company without Cause, or (y) by the Executive with Good Reason, or (B) due to nonrenewal of the Term by the Company pursuant to Section 2, the Company shall pay (unless otherwise noted, in the normal course) to the Executive or provide the following amounts or benefits:

(i)to the extent not yet paid, the Executive’s Base Salary through the date of termination at the rate in effect on the date of termination;

(ii)one year’s Base Salary (as in effect as of the date of termination), payable as  continued payment of Base Salary (payable in accordance with the Company’s payroll practice);

(iii)payment of the Preceding and/or Pro Rata Bonus to which the Executive is entitled, payable in accordance with Section 3.2;

(iv)vesting of any unvested RSUs; and

(v)any and all time-vesting equity awards that have been granted to the Executive (that have neither expired nor been previously exercised by the Executive) through the termination date shall be deemed fully vested on such termination date and, to the extent applicable, exercisable for a period of 90 days following such date (but, in no case, beyond each such award’s specified expiration date), and any performance-vesting equity awards shall be eligible to vest on a pro rata basis based on the period of time the Executive was employed during the performance period and achievement of the applicable performance goals, all in accordance with the other terms of any such plan or grant.

All payments to be provided to the Executive under this Section 5.4 shall be subject to the Executive’s (x) compliance with the restrictions in Section 7 and (y) execution, within 60 days of the Executive’s termination, of a general release and waiver of claims against the Company, its officers, directors, employees and agents from any and all liability arising from the Executive’s employment relationship with the Company (which release will include an agreement between both parties not to disparage the other) that is not revoked.

6.Change in Control.

6.1In the event of the occurrence of a Change in Control of the Company, the Executive shall remain employed by the Company, pursuant to the terms and conditions of this Agreement.  If, within two years after the Change in Control, (A) the Executive’s employment is terminated without Cause or with Good Reason, (B) the Term ends due to nonextension of the Term by the Company pursuant to Section 2, or (C) the Executive resigns following:

(i)a material diminution in his duties as set forth in Section 1.2 of this Agreement; or

(ii)in the case of the sale of the Company, the Executive either:  (a) is not offered a comparable position by the buyer; or (b) is required by the buyer to be based anywhere beyond 50 miles from the Company’s current offices in Rochester, New York (except for required travel on Company business to an extent substantially consistent with that preceding the Change in Control), (either (i) or (ii), a “Resignation for Good Cause”), then the Executive shall be entitled to the benefits described in Section 6.2.

6.2Upon a termination without Cause or with Good Reason in a Change in Control, the Term ends due to nonextension of the Term by the Company or a Resignation for Good Cause described in Section 6.1 during the Term, the Executive will receive in one lump sum amount, unless otherwise noted:

(A)to the extent not yet paid, the Executive’s Base Salary through the date of termination at the rate in effect on the date of termination;

(B)two year’s Base Salary (as in effect as of the date of such termination or resignation), payable as continued payment of Base Salary (payable in accordance with the Company’s payroll practice);

(C)payment of the Preceding and/or Pro Rata Bonus to which the Executive is entitled, payable in accordance with Section 3.2; and

(D)vesting of any unvested RSUs;

(E)any and all time-vesting equity awards that have been granted to the Executive (that have neither expired nor been previously exercised by the Executive) through the termination date shall be deemed fully vested on such termination date and, to the extent applicable, exercisable for a period of 90 days following such date (but, in no case, beyond each such award’s specified expiration date), and any performance-vesting equity awards shall be eligible to vest on a pro rata basis based on the period of time the Executive was employed during the performance period and achievement of the applicable performance goals, all in accordance with the other terms of any such plan or grant.

All payments to be provided to the Executive under this Section shall be subject to the Executive’s (x) compliance with the restrictions in Section 7 and (y) execution, within 60 days of the Executive’s termination, of a general release and waiver of claims against the Company, its officers, directors, employees and agents from any and all liability arising from the Executive’s employment relationship with the Company (which release will include an agreement between both parties not to disparage the other) that is not revoked.

6.3For purposes of this Agreement, a “Change in Control” shall mean any of the following:  (A) any person who is not an “affiliate” (as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended) of the Company as of the date of this Agreement becomes the beneficial owner, directly or indirectly, of 50% or more of the combined voting power of the then outstanding securities of the Company except pursuant to a public offering of securities of the Company; (B) the sale of the Company substantially as an entity (whether by sale

of stock, sale of assets, merger, consolidation, or otherwise) to a person who is not an affiliate of the Company as of the date of this Agreement; or (C) there occurs a merger, consolidation or other reorganization of the Company with a person who is not an affiliate of the Company as of the date of this Agreement, and in which shareholders of the Company immediately preceding the merger hold less than 50% (the voting and consent rights of Class C Preferred Stock shall be disregarded in this calculation) of the combined voting power for the election of directors of the Company immediately following the merger.  For purposes of this Section 6.3, the term “person” shall include a legal entity, as well as an individual.  A Change in Control shall not be deemed to occur because of the sale or conversion of any or all of Class C Preferred Stock of the Company unless there is a simultaneous change described in clauses (A), (B) or (C) of the preceding sentence.

7.Confidentiality and Covenant against Competition.

7.1Non-Disclosure.

(A)The Executive shall forever hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company or any of its affiliated companies, and their respective businesses, which shall have been obtained by the Executive during the Executive’s employment by the Company or any of its affiliated companies and which shall not be public knowledge (other than as a result of a breach of this Section 7.1 by the Executive).  The Executive shall not, without the prior written consent of the Company or except as required by law or in a judicial or administrative proceeding with subpoena powers, communicate or divulge any such information, knowledge or data to anyone other than the Company and those designated by it.

(B)Notwithstanding the foregoing, nothing in this Agreement shall (i) prohibit the Executive from making reports of possible violations of federal law or regulation to any governmental agency or entity in accordance with the provisions of and rules promulgated under Section 21F of the Securities Exchange Act of 1934 or Section 806 of the Sarbanes-Oxley Act of 2002, or of any other whistleblower protection provisions of state or federal law or regulation, or (ii) require notification or prior approval by the Company of any reporting described in clause (i).

(C)Pursuant to The Defend Trade Secrets Act (18 USC § 1833(b)), the Executive may not be held criminally or civilly liable under any federal or state trade secret law for disclosure of a trade secret:  (i) made in confidence to a government official, either directly or indirectly, or to an attorney, solely for the purpose of reporting or investigating a suspected violation of law; and/or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.  Additionally, the Executive, if suing the Company for retaliation based on the reporting of a suspected violation of law, may disclose a trade secret to his attorney and use the trade secret information in the court proceeding, so long as any document containing the trade secret is filed under seal and the Executive does not disclose the trade secret except pursuant to court order.

7.2Non-Competition.  The Executive will not, during the period of the Executive’s employment with the Company, and for a period of one year thereafter, directly or indirectly, (a) engage in (as a principal, partner, director, officer, stockholder (except as permitted below), agent, employee, consultant or otherwise); or (b) be financially interested in, any entity materially engaged in any portion of the business of the Company within the territory served, or contemplated to be entered, by the Company on the date of such termination of employment.  Nothing contained herein shall prevent the Executive from owning beneficially or of record not more than five percent of the outstanding equity securities of any entity whose equity securities are registered under the Securities Act of 1933, as amended, or are listed for trading on any recognizable United States or foreign stock exchange or market.  The business of the Company shall be defined to include the automotive repair/maintenance services, as well as the sale and service of tires and related accessories, each of which shall be deemed a portion of the business.

7.3Non-Solicitation of Employees.  The Executive will not, during the period of the Executive’s employment with the Company, and for a period of one year after the termination of the Executive’s employment with the Company for any reason, directly or indirectly, recruit, solicit or otherwise induce or attempt to induce any employee of the Company to leave the employment of the Company, nor hire any such employee at any enterprise with which the Executive is then affiliated.

7.4Enforceability of Provisions.  If any restriction set forth in this Section 7 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable, it being understood and agreed that by the execution of this Agreement, the parties hereto regard the restrictions herein as reasonable and compatible with their respective rights.

7.5Remedy for Breach.  The Executive hereby acknowledges that the provisions of this Section 7 are reasonable and necessary for the protection of the Company and its respective subsidiaries and affiliates.  In addition, the Executive further acknowledges that the Company and its respective subsidiaries and affiliates will be irrevocably damaged if such covenants are not specifically enforced.  Accordingly, the Executive agrees that, in addition to any other relief to which the Company may be entitled, the Company will be entitled to seek and obtain injunctive relief from a court of competent jurisdiction for the purposes of restraining the Executive from an actual or threatened breach of such covenants.  In addition, and without limiting the Company’s other remedies, in the event of any breach by the Executive of such covenants, as determined by the applicable court, the Company will have no obligation to pay any of the amounts that remain payable by the Company in Sections 5 and 6 of this Agreement.

8.Executive’s Representations.  The Executive represents that he is not precluded from performing this employment by reason of a preexisting contractual restriction or physical or mental disability.  Upon any breach or inaccuracy of the foregoing, the terms and benefits of this Agreement shall be null and void.  The Executive shall indemnify and hold harmless the Company from and against any and all claims, liabilities, damages and reasonable costs of defense and investigation arising out of any breach or inaccuracy in any of the foregoing representations.

9.Other Provisions.

9.1Withholdings.  The Company may withhold from any amounts payable under this Agreement such federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation.

9.2Notices.  Any notice or other communication required or which may be given hereunder shall be in writing and shall be delivered personally, telecopied, or sent by certified, registered or express mail, postage prepaid, to the parties at the following addresses or at such other addresses as shall be specified by the parties by like notice, and shall be deemed given when so delivered personally, telecopied or if mailed, two days after the date of mailing, as follows:

(a)if to the Company, to it at:

Monro, Inc.
200 Holleder Parkway
Rochester, New York 14615
Attention:  Chief Financial Officer

with a copy to:

Monro, Inc.
200 Holleder Parkway
Rochester, New York 14615
Attention:  General Counsel

(b)if to the Executive, to him at the address reflected in the Company’s payroll records

with a copy to:

Jordan Price Wall Gray Jones & Carlton, PLLC
1951 Clark Avenue
Raleigh, North Carolina 27605
Attention:  Terry J. Carlton

9.3Entire Agreement.  This Agreement contains the entire understanding of the Company and the Executive with respect to the subject matter hereof and supersedes all prior written or verbal understandings with respect thereto.

9.4Waivers and Amendments.  This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.  No delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any party of any right, power or privilege hereunder, nor any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

9.5Governing Law; Jurisdiction.  This Agreement shall be governed by and construed and enforced in accordance with and subject to, the laws of the State of New York applicable to agreements made and to be performed entirely within such state.  The courts of New York and the United States District Courts for New York shall have jurisdiction over the parties with respect to any dispute or controversy between them arising under or in connection with this Agreement.

9.6Assignment.  This Agreement shall inure to the benefit of and shall be binding upon the Company and its successors.  This Agreement is personal to the Executive and shall not be assignable by Executive otherwise than by will or the laws of descent and distribution.  The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.  As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.

9.7Headings.  The headings in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.

9.8Severability.  If any term, provision, covenant or restriction of this Agreement, or any part thereof, is held by a court of competent jurisdiction of any foreign, federal, state, county or local government or any other governmental, regulatory or administrative agency or authority to be invalid, void, unenforceable or against public policy for any reason, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

9.9Section 280G.  In the event that the Executive becomes entitled to any payments or benefits under this Agreement and any portion of such payments or benefits, when combined with any other payments or benefits provided to Executive (including, without limiting the generality of the foregoing, by reason of the exercise or vesting of any stock options or the receipt or vesting of any other equity awards), which in the absence of this Section 9.9 would be subject to the tax (the “Excise Tax”) imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), then the amount payable to the Executive under this Agreement shall, either (A) be reduced to the largest amount or greatest right such that none of the amounts payable to the Executive under this Agreement and any other payments or benefits received or to be received by Executive as a result of, or in connection with, an event constituting a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company (within the meaning of Section 280G(b)(2)(A) of the Code) or the termination of employment shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code or (B) be made in full, with Executive bearing full responsibility for any Excise Tax

liability, whichever of (A) or (B) provides the Executive with a larger net after-tax amount.  The Company shall cooperate in good faith with the Executive in making such determination, including but not limited to providing the Executive with an estimate of any parachute payments as soon as reasonably practicable prior to an event constituting a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company (within the meaning of Section 280G(b)(2)(A) of the Code).  Any reduction pursuant to this Section 9.9 shall be made in a manner compliant with Section 409A of the Code.  This Section 9.9 shall apply in lieu of any provision applicable to the Executive under any other agreement or arrangement (including the Plan) with respect to Section 4999 of the Code.  All determinations with respect to this Section 9.9 shall be made by an independent nationally recognized certified public accounting firm reasonably acceptable to the Executive at the Company’s sole expense.  The after tax amount shall be calculated, as applicable, using the maximum marginal income tax rates for each year in which the payment is payable to the Executive (based upon the rates in effect for such year as set forth in the Code at the relevant time).

9.10Section 409A.  The compensation and benefits provided under this Agreement are intended to qualify for an exemption from or to comply with the requirements of Section 409A of the Code and the treasury regulations and other official guidance issued thereunder (collectively, “Section 409A”), so as to prevent the inclusion in gross income of any compensation or benefits accrued hereunder in a taxable year prior to the taxable year or years in which such amount would otherwise be actually distributed or made available to the Executive, and this Agreement shall be administered and interpreted consistent with such intention.  For purposes of Sections 4, 5 and 6 of this Agreement, “removal,” “termination of the Executive’s employment” and words of similar import mean a “separation from service” with the Company as defined by Section 409A.  The reimbursement of taxable expenses such as contemplated in Sections 3.5 and 3.7 to the Executive shall be made no later than the end of the year following the year in which the expense was incurred, and the expenses reimbursed in one year shall not affect the expenses eligible for reimbursement in any other year.  Where the 60-day period for the Executive to execute and not revoke a general release and waiver begins in one calendar year and ends in the following calendar year, payment shall be made no sooner than the first day of the following calendar year.  Each payment shall be a payment in a series of separate payments for all purposes under Section 409A.  If the Executive is a “specified employee” within the meaning of Section 409A at the time of his “separation from service” within the meaning of  Section 409A, then any payment otherwise required to be made to him under this Agreement on account of his separation from service, to the extent such payment (after taking in to account all exclusions applicable to such payment under Section 409A) is properly treated as deferred compensation subject to Section 409A, shall not be made until the first business day after (i) the expiration of six months from the date of the Executive’s separation from service, or (ii) if earlier, the date of the Executive’s death (the “Delayed Payment Date”) and, on the Delayed Payment Date, there shall be paid to the Executive or, if the Executive has died, to the Executive’s estate, in a single cash lump sum, an amount equal to aggregate amount of the payments delayed pursuant to the preceding clause.

9.11Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have executed this Employment Agreement on the date first above written.

MONRO, INC.

By:

/s/ Robert E. Mellor
Robert E. Mellor
Interim Chief Executive Officer and Chairman of the Board

/s/ Michael T. Broderick
Michael Broderick

EX-21.01

Exhibit 21.01

SUBSIDIARIES OF THE COMPANY

Monro Service Corporation	Delaware
Car-X, LLC	Delaware
MNRO Holdings, LLC	Delaware
MNRO Service Holdings, LLC	Delaware*

_____________________

*MNRO Service Holdings, LLC is a subsidiary of Monro Service Corporation

EX-23.01

Exhibit 23.01

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (File Nos. 333-34290, 333-151196, 333-63880, 333-173129 and 333-196783) of Monro, Inc. of our report dated May 26, 2021 relating to the financial statements and the effectiveness of internal control over financial reporting, which appears in this Form 10-K.

/s/PricewaterhouseCoopers LLP

Rochester, New York

May 26, 2021

EX-24.01

Exhibit 24.01

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that the undersigned directors of Monro, Inc., a New York corporation (the "Corporation"), do constitute and appoint MICHAEL T. BRODERICK to be their true and lawful attorney-in-fact and agent, with full powers of substitution, for and in the name, place and stead of the undersigned, in any and all capacities in connection with the filing of the Annual Report on Form 10-K of the Corporation for the fiscal year ended March 27, 2021 (the "Form 10-K") with the Securities and Exchange Commission, to sign the Form 10-K and any and all amendments related thereto and to file the same, with any exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, or his substitutes, full power and authority to do and perform each and every act and thing requisite and necessary to be done for all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this power of attorney has been signed by the following directors on May 26, 2021.

/s/ John L. Auerbach

John L. Auerbach

/s/ Frederick M. Danziger

Frederick M. Danziger

/s/ Donald Glickman

Donald Glickman

/s/ Lindsay N. Hyde

Lindsay N. Hyde

/s/ Leah C. Johnson

Leah C. Johnson

/s/ Stephen C. McCluski

Stephen C. McCluski

/s/ Robert E. Mellor

Robert E. Mellor

/s/ Peter J. Solomon

Peter J. Solomon

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Michael T. Broderick, certify that:

1. I have reviewed this annual report on Form 10-K of Monro, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 26, 2021

/s/ Michael T. Broderick

Michael T. Broderick

President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Brian J. D’Ambrosia, certify that:

1. I have reviewed this annual report on Form 10-K of Monro, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))  for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 26, 2021

/s/ Brian J. D’Ambrosia

Brian J. D’Ambrosia

Executive Vice President – Finance,

Chief Financial Officer and Treasurer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

(SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002)

Pursuant to, and solely for purposes of, 18 U.S.C. Section 1350 (Section 906 of the Sarbanes-Oxley Act of 2002), each of the undersigned hereby certifies in the capacity and on the date indicated below that:

1.  The Annual Report of Monro, Inc. ("Monro") on Form 10-K for the period ended March 27, 2021 as filed with the Securities and Exchange Commission on the date hereof (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.  The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Monro.

/s/ Michael T. Broderick	Dated:  May 26, 2021
Michael T. Broderick
President and Chief Executive Officer
/s/ Brian J. D’Ambrosia	Dated:  May26, 2021
Brian J. D’Ambrosia
Executive Vice President – Finance,
Chief Financial Officer and Treasurer

XML

Document and Entity Information - USD ($)	12 Months Ended
	Mar. 27, 2021	May 21, 2021	Sep. 25, 2020
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Mar. 27, 2021
Current Fiscal Year End Date	--03-27
Document Fiscal Year Focus	2021
Document Transition Report	false
Entity File Number	0-19357
Entity Registrant Name	Monro, Inc.
Entity Incorporation, State or Country Code	NY
Entity Tax Identification Number	16-0838627
Entity Address, Address Line One	200 Holleder Parkway
Entity Address, City or Town	Rochester
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	14615
City Area Code	585
Local Phone Number	647-6400
Title of 12(b) Security	Common Stock, par value $.01 per share
Trading Symbol	MNRO
Security Exchange Name	NASDAQ
Entity Well Known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
ICFR Auditor Attestation Flag	true
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 1,331,800,000
Entity Common Stock Shares Outstanding		33,492,878
Documents Incorporated by Reference [Text Block]	DOCUMENTS INCORPORATED BY REFERENCEPortions of the registrant’s definitive Proxy Statement for its 2021 Annual Meeting of Shareholders to be held hereafter are incorporated by reference into Part III of this report.
Entity Central Index Key	0000876427
Amendment Flag	false
Document Fiscal Period Focus	FY

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 27, 2021	Mar. 28, 2020
Current assets
Cash and equivalents	$ 29,960	$ 345,476
Accounts receivable	15,324	14,510
Federal and state income taxes receivable	10,844	8,056
Inventories	162,282	187,441
Other current assets	48,115	40,537
Total current assets	266,525	596,020
Property and equipment, net	327,063	328,637
Finance lease and financing obligation assets, net	275,360	196,575
Operating lease assets, net	203,329	199,729
Goodwill	689,524	671,843
Intangible assets, net	26,068	29,781
Other non-current assets	18,332	20,688
Long-term deferred income tax assets	5,613	6,184
Total assets	1,811,814	2,049,457
Current liabilities
Current portion of finance leases and financing obligations	37,803	32,257
Current portion of operating lease liabilities	30,903	30,181
Accounts payable	112,378	99,504
Accrued payroll, payroll taxes and other payroll benefits	20,842	14,429
Accrued insurance	49,681	43,387
Deferred revenue	11,956	13,129
Other current liabilities	27,053	22,049
Total current liabilities	290,616	254,936
Long-term debt	190,000	566,400
Long-term finance leases and financing obligations	366,330	298,373
Long-term operating lease liabilities	177,724	170,954
Other long-term liabilities	16,649	12,873
Long-term deferred income tax liabilities	19,783	10,069
Long-term income taxes payable	1,028	1,412
Total liabilities	1,062,130	1,315,017
Commitments and contingencies - Note 15
Shareholders' equity
Class C Convertible Preferred Stock	29	33
Common Stock	398	396
Treasury Stock	(108,729)	(108,729)
Additional paid-in capital	238,244	229,774
Accumulated other comprehensive loss	(4,619)	(6,889)
Retained earnings	624,361	619,855
Total shareholders' equity	749,684	734,440
Total liabilities and shareholders' equity	$ 1,811,814	$ 2,049,457

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 27, 2021	Mar. 28, 2020
Consolidated Balance Sheets [Abstract]
Class C convertible preferred stock shares authorized	150,000	150,000
Class C convertible preferred stock par value	$ 1.50	$ 1.50
Class C convertible preferred stock, conversion value	$ 0.064	$ 0.064
Class C convertible preferred stock shares issued	19,664	21,802
Class C convertible preferred stock shares outstanding	19,664	21,802
Common stock shares authorized	65,000,000	65,000,000
Common stock par value	$ 0.01	$ 0.01
Common stock shares issued	39,848,093	39,644,228
Treasury stock shares	6,359,871	6,359,871

XML

Consolidated Statements Of Income And Comprehensive Income - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Consolidated Statements Of Income And Comprehensive Income [Abstract]
Sales	$ 1,125,721	$ 1,256,524	$ 1,200,230
Cost of sales, including distribution and occupancy costs	730,526	779,866	735,002
Gross profit	395,195	476,658	465,228
Operating, selling, general and administrative expenses	322,957	374,956	338,485
Operating income	72,238	101,702	126,743
Interest expense, net of interest income	28,235	28,213	27,013
Other income, net of other loss	(188)	(785)	(630)
Income before income taxes	44,191	74,274	100,360
Provision for income taxes	9,872	16,250	20,608
Net income	34,319	58,024	79,752
Other comprehensive income (loss)
Changes in pension, net of tax provision (benefit)	2,270	(2,353)	(288)
Other comprehensive income (loss)	2,270	(2,353)	(288)
Comprehensive income	$ 36,589	$ 55,671	$ 79,464
Earnings per share
Basic	$ 1.02	$ 1.73	$ 2.41
Diluted	$ 1.01	$ 1.71	$ 2.37
Weighted average common shares outstanding
Basic	33,329	33,246	32,980
Diluted	33,876	33,953	33,675

XML

Consolidated Statements Of Changes in Shareholders' Equity - USD ($) $ in Thousands		Class C Convertible Preferred Stock [Member]	Common Stock [Member]	Treasury Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive Loss [Member]	Retained Earnings [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Retained Earnings [Member]	Cumulative Effect, Period of Adoption, Adjustment [Member]	Total
Balance beginning at Mar. 31, 2018		$ 33	$ 392	$ (106,563)	$ 199,576	$ (4,248)		$ 539,286		$ 628,476
Beginning balance, preferred shares at Mar. 31, 2018		22,000
Beginning balance, common shares at Mar. 31, 2018			39,166,000	6,330,000
Net income								79,752		79,752
Other comprehensive loss
Pension liability adjustment						(288)				(288)
Dividends declared
Preferred								(408)		(408)
Common								(26,406)		(26,406)
Dividend payable								(50)		(50)
Stock options and restricted stock	[1]		$ 3	$ (2,166)	16,575					14,412
Stock options and restricted stock, shares	[1]		345,000	30,000
Stock-based compensation					4,022					4,022
Balance ending at Mar. 30, 2019		$ 33	$ 395	$ (108,729)	220,173	(4,536)	$ (582)	592,174	$ (582)	699,510
Ending balance, preferred shares at Mar. 30, 2019		22,000
Ending balance, common shares at Mar. 30, 2019			39,511,000	6,360,000
Net income								58,024		58,024
Other comprehensive loss
Pension liability adjustment						(2,353)				(2,353)
Dividends declared
Preferred								(449)		(449)
Common								(29,266)		(29,266)
Dividend payable								(46)		(46)
Stock options and restricted stock			$ 1		5,788					5,789
Stock options and restricted stock, shares			134,000
Stock-based compensation					3,813					3,813
Balance ending at Mar. 28, 2020		$ 33	$ 396	$ (108,729)	229,774	(6,889)		619,855		$ 734,440
Ending balance, preferred shares at Mar. 28, 2020		22,000								21,802
Ending balance, common shares at Mar. 28, 2020			39,645,000	6,360,000
Net income								34,319		$ 34,319
Other comprehensive loss
Pension liability adjustment						2,270				2,270
Dividends declared
Preferred								(438)		(438)
Common								(29,344)		(29,344)
Dividend payable								(31)		(31)
Conversion of Class C Preferred Stock		$ (4)	$ 1		3
Conversion of Class C Preferred Stock, shares		(2,000)	50,000
Stock options and restricted stock			$ 1		6,076					6,077
Stock options and restricted stock, shares			153,000
Stock-based compensation					2,391					2,391
Balance ending at Mar. 27, 2021		$ 29	$ 398	$ (108,729)	$ 238,244	$ (4,619)		$ 624,361		$ 749,684
Ending balance, preferred shares at Mar. 27, 2021		20,000								19,664
Ending balance, common shares at Mar. 27, 2021			39,848,000	6,360,000

[1] Includes the receipt of treasury stock in connection with the exercise of stock options and to partially satisfy tax withholding obligations.

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Consolidated Statements Of Changes in Shareholders' Equity (Parenthetical) - $ / shares	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Consolidated Statements Of Changes In Shareholders' Equity [Abstract]
Common stock cash dividends per share	$ 0.88	$ 0.88	$ 0.80

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Consolidated Statements Of Cash Flows - USD ($)	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Operating activities:
Net income	$ 34,319,000	$ 58,024,000	$ 79,752,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	77,304,000	64,986,000	55,531,000
Share-based compensation expense	2,391,000	3,813,000	4,022,000
(Gain) loss on disposal of assets	(491,000)	(257,000)	56,000
Impairment of long-lived assets	144,000	6,579,000	0
Deferred income tax expense	10,854,000	11,473,000	12,517,000
Change in operating assets and liabilities (excluding acquisitions)
Accounts receivables	(814,000)	107,000	(1,361,000)
Inventories	26,570,000	(11,841,000)	(9,126,000)
Other current assets	22,566,000	5,379,000	(514,000)
Other non-current assets	3,331,000	24,968,000	(427,000)
Accounts payables	12,874,000	(4,090,000)	19,037,000
Accrued expenses	21,355,000	(3,871,000)	(3,019,000)
Federal and state income taxes receivable	(2,788,000)	(2,470,000)	(1,401,000)
Other long-term liabilities	(22,326,000)	(31,100,000)	(1,967,000)
Long-term income taxes payable	(384,000)	(371,000)	(209,000)
Cash provided by operating activities	184,905,000	121,329,000	152,891,000
Investing activities
Capital expenditures	(51,725,000)	(55,918,000)	(44,468,000)
Acquisitions, net of cash acquired	(17,154,000)	(104,436,000)	(62,427,000)
Proceeds from the disposal of assets	659,000	967,000	723,000
Other	1,960,000	576,000	289,000
Cash used for investing activities	(66,260,000)	(158,811,000)	(105,883,000)
Financing activities:
Proceeds from borrowings		814,181,000	433,460,000
Principal payments on long-term debt, capital leases and financing obligations	(409,783,000)	(412,725,000)	(463,989,000)
Exercise of stock options	6,278,000	6,171,000	14,640,000
Dividends paid	(29,782,000)	(29,715,000)	(26,814,000)
Deferred financing costs	(874,000)	(1,168,000)
Cash (used for) provided by financing activities	(434,161,000)	376,744,000	(42,703,000)
Net (decrease) increase in cash	(315,516,000)	339,262,000	4,305,000
Cash at beginning of year	345,476,000	6,214,000	1,909,000
Cash at end of year	29,960,000	345,476,000	6,214,000
Supplemental information:
Interest paid, net	26,376,000	27,250,000	25,422,000
Income taxes	2,334,000	12,745,000	9,680,000
Leased assets obtained in exchange for new finance lease liabilities	104,165,000	64,393,000	$ 14,632,000
Leased assets obtained in exchange for new operating lease liabilities	$ 24,409,000	$ 6,980,000

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Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies

12 Months Ended

Mar. 27, 2021

Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract]

Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies

Note 1 – Description of Business, Basis of Presentation and Summary of Significant Accounting Policies

Description of business

Monro, Inc. and its direct and indirect subsidiaries (together, “Monro”, the “Company”, “we”, “us”, or “our”), are engaged principally in providing automotive undercar repair and tire replacement sales and tire related services in the United States. Monro had 1,263 Company-operated stores, 96 franchised locations, seven wholesale locations and three retread facilities located in 32 states as of March 27, 2021.

Monro’s operations are organized and managed in one operating segment. The internal management financial reporting that is the basis for evaluation in order to assess performance and allocate resources by our chief operating decision maker consists of consolidated data that includes the results of our retail, commercial and wholesale locations. As such, our one operating segment reflects how our operations are managed, how resources are allocated, how operating performance is evaluated by senior management and the structure of our internal financial reporting.

Basis of presentation

Principles of consolidation

The consolidated financial statements include the accounts of Monro, Inc. and its direct and indirect subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Management’s use of estimates

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of financial statements in conformity with such principles requires the use of estimates by management during the reporting period. Actual results could differ from those estimates.

Fiscal year

We operate on a 52/53 week fiscal year ending on the last Saturday in March. Fiscal years 2021 and 2020 each contained 52 weeks and fiscal year 2019 contained 53 weeks. Unless specifically indicated otherwise, any references to “2021” or “fiscal 2021,” “2020” or “fiscal 2020,” and “2019” or “fiscal 2019” relate to the years ended March 27, 2021, March 28, 2020 and March 30, 2019, respectively.

Recent accounting pronouncements

In August 2018, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance which eliminates, adds and modifies certain disclosure requirements for fair value measurements. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2019. Early adoption is permitted. We adopted this guidance during the first quarter of 2021. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In December 2019, the FASB issued new accounting guidance intended to simplify the accounting for income taxes. The new guidance removes certain exceptions to the general principles in Accounting Standards Codification (“ASC”) Topic 740, “Income Taxes,” and amends existing guidance to improve consistent application. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2020. Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

Other recent authoritative guidance issued by the FASB (including technical corrections to the ASC) and the Securities and Exchange Commission (“SEC”) did not, or are not expected to have a material effect on Monro’s consolidated financial statements.

Summary of significant accounting policies

Cash and cash equivalents

Cash consists primarily of cash on hand and deposits with banks. Cash equivalents include highly liquid investments with an original maturity of three months or less from the time of purchase. Cash equivalents also include amounts due from third-party financial institutions for credit and debit card transactions. These receivables typically settle in three days or less.

Inventories

Our inventories, which consist of automotive parts and oil as well as tires, are valued at the lower of weighted average cost or net realizable value.

Property and equipment, net

Property and equipment, net is stated at historical cost less accumulated depreciation. Property and equipment is depreciated using the straight-line method over estimated useful lives. Leasehold improvements are depreciated over the shorter of their estimated useful lives or the related lease terms. When assets are disposed of, the resulting gain or loss is recognized in other income, net of other loss on the Consolidated Statement of Income and Comprehensive Income. Expenditures for maintenance and repairs are expensed as incurred.

Estimated Useful Lives	Life (Years)
Buildings and improvements	10 - 39
Equipment, signage and fixtures	3 - 15
Vehicles	5 - 10

Valuation of long-lived assets

We assess potential impairments to our long-lived assets, which include property and equipment and operating right-of-use (“ROU”) assets, whenever events or circumstances indicate that the carrying value of an asset may not be recoverable. Long-lived assets are grouped and evaluated for impairment at the lowest level for which there are identifiable cash flows that are independent of the cash flows of other groups of assets. If it is determined that the carrying amounts of such long-lived assets are not recoverable, the assets are written down to their estimated fair values. Fair value of the assets is determined based on the highest and best use of the asset group, considering external market participant assumptions. Since the determination of future cash flows is an estimate of future performance, there may be future impairments in the event that future cash flows do not meet expectations.

During 2020, we evaluated certain stores having indicators of impairment based on operating performance and taking into consideration the negative impact of the novel coronavirus strain (“COVID-19”) pandemic on forecasted store performance. Based on the estimate of future recoverable cash flows, we recorded an impairment charge totaling $6.6 million of which $4.3 million was related to 36 stores that closed in 2021. As part of the impairment charge, we wrote off $4.4 million of operating lease ROU assets, $0.6 million of finance lease ROU assets and $1.6 million of leasehold improvements and equipment.

No material impairment charges were recorded during 2021 or 2019.

Leases

We determine if an arrangement is or contains a lease at inception. We record ROU assets and lease obligations for our finance and operating leases, which are initially based on the discounted future minimum lease payments over the term of the lease. As the rate implicit in our leases is not easily determinable, our applicable incremental borrowing rate is used in calculating the present value of the lease payments. We estimate our incremental borrowing rate considering the market rates of our outstanding borrowings and comparisons to comparable borrowings of similar terms.

Lease term is defined as the non-cancelable period of the lease plus any option to extend the lease when it is reasonably certain that it will be exercised. For leases with an initial term of 12 months or less, no ROU assets or lease obligations are recorded on the balance sheet and we recognize short-term lease expense for these leases on a straight-line basis over the lease term.

Certain of our lease agreements include rental payments based on a percentage of retail sales over specified levels and others include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. For the majority of all classes of underlying assets, we have elected to separate lease from non-lease components. We have elected to combine lease and non-lease components for certain classes of equipment. We generally sublease excess space to third parties.

Operating lease expense is recognized on a straight-line basis over the lease term and is included in cost of sales, including distribution and occupancy costs (“cost of sales”) or operating, selling, general and administrative (“OSG&A”) expense. Amortization expense for

finance leases is recognized on a straight-line basis over the lease term and is included in cost of sales or OSG&A expense. Interest expense for finance leases is recognized using the effective interest method, and is included in interest expense, net of interest income. Variable payments, short-term rentals and payments associated with non-lease components are expensed as incurred.

Effective March 31, 2019, we adopted using the modified retrospective approach an accounting standards update with new guidance related to leases. The adoption of this guidance resulted in a $165.3 million increase to total assets, a $165.9 million increase to total liabilities and a $0.6 million decrease in shareholder’s equity as of March 31, 2019. Periods prior to fiscal 2020 have not been restated for the adoption of this standard update.

Goodwill and intangible assets

We have a history of growth through acquisitions. Assets and liabilities of acquired businesses are recorded at their estimated fair values as of the date of acquisition. Goodwill represents costs in excess of fair values assigned to the underlying net assets of acquired businesses. The carrying value of goodwill is subject to an annual impairment test, which we perform in the third quarter of the fiscal year. Impairment tests may also be triggered by any significant events or changes in circumstances affecting our business.

We have one reporting unit which encompasses all operations including new acquisitions. In performing our annual goodwill impairment test, we perform a qualitative assessment to determine if it is more likely than not that the fair value is less than the carrying value of goodwill. The qualitative assessment includes a review of business changes, economic outlook, financial trends and forecasts, growth rates, industry data, market capitalization and other relevant qualitative factors. If the qualitative factors indicate a potential impairment, we compare the fair value of our reporting unit to the carrying value of our reporting unit. If the fair value is less than its carrying value, an impairment charge is recognized in an amount equal to that excess. The loss recognized cannot exceed the carrying amount of goodwill. As a result of our annual qualitative assessment performed in the third quarter of 2021, we determined that it is not more likely than not that the fair value is less than the carrying value.

Subsequent to our prior year assessment performed in the third quarter of 2020, and due to developments associated with the COVID-19 pandemic, we considered our business performance expectations, as well as our share price as of 2020 year end in relation to the share price when the annual qualitative assessment was performed in the third quarter of 2020. Based on our analysis, we concluded that the events and circumstances related to the COVID-19 pandemic did not indicate an impairment of goodwill was more likely than not as of March 28, 2020.

Our intangible assets primarily represent allocations of purchase price to identifiable intangible assets of acquired businesses and are amortized over their estimated useful lives. All intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that an impairment may exist. If such indicators are present, it is determined whether the sum of the estimated undiscounted future cash flows attributable to such assets is less than their carrying values. Based on our review as of March 27, 2021, we concluded that the carrying values of our intangible assets were not impaired. No impairment was recorded in 2021, 2020 or 2019.

A deterioration of macroeconomic conditions may not only negatively impact the estimated operating cash flows used in our cash flow models, but may also negatively impact other assumptions used in our analyses, including, but not limited to, the estimated cost of capital and/or discount rates. Additionally, we are required to ensure that assumptions used to determine fair value in our analyses are consistent with the assumptions a hypothetical marketplace participant would use. As a result, the cost of capital and/or discount rates used in our analyses may increase or decrease based on market conditions and trends, regardless of whether our actual cost of capital has changed. Therefore, we may recognize an impairment of an intangible asset or assets even though realized actual cash flows are approximately equal to or greater than our previously forecasted amounts.

Self-insurance reserves

We are largely self-insured with respect to workers’ compensation, general liability and employee medical claims. In order to reduce our risk and better manage our overall loss exposure, we purchase stop-loss insurance that covers individual claims in excess of the deductible amounts, and caps total losses in a fiscal year. We maintain an accrual for the estimated cost to settle open claims as well as an estimate of the cost of claims that have been incurred but not reported. These estimates take into consideration the historical average claim volume, the average cost for settled claims, current trends in claim costs, changes in our business and workforce, and general economic factors. These accruals are reviewed on a quarterly basis, or more frequently if factors dictate a more frequent review is warranted. For more complex reserve calculations, such as workers’ compensation, we periodically use the services of an actuary to assist in determining the required reserve for open claims.

Warranty

We provide an accrual for estimated future warranty costs for parts that we install based upon the historical relationship of warranty costs to sales. Warranty expense related to all product warranties for the fiscal years ended March 2021, 2020 and 2019 was not material to our financial position or results of operations. See Note 8 for additional information on tire road hazard warranty agreements.

Comprehensive income

As it relates to Monro, comprehensive income is defined as net income as adjusted for pension liability adjustments and is reported net of related taxes in the Consolidated Statements of Income and Comprehensive Income and in the Consolidated Statements of Changes in Shareholders’ Equity.

Income taxes

We account for income taxes pursuant to the asset and liability method which requires the recognition of deferred tax assets and liabilities related to the expected future tax consequences arising from temporary differences between the carrying amounts and tax bases of assets and liabilities based on enacted statutory tax rates applicable to the periods in which the temporary differences are expected to reverse. Any effects of changes in income tax rates or laws are included in income tax expense in the period of enactment. A valuation allowance is recognized if we determine it is more likely than not that all or a portion of a deferred tax asset will not be recognized. In making such determination, the Company considers all available evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent and expected future results of operation. Monro recognizes a tax benefit from an uncertain tax position in the financial statements only when it is more likely than not that the position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits and a consideration of the relevant taxing authority's administrative practices and precedents.

On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) to provide certain relief as a result of the COVID-19 pandemic. The CARES Act provides tax relief, along with other stimulus measures, including an employer deferral of the deposit of the employer’s share of social security taxes during the period beginning March 27, 2020 and ending December 31, 2020. We deferred the employer paid portion of social security taxes as permitted by the CARES Act during fiscal 2021 and may continue to defer payment prior to the applicable date the deposits must be paid.

Treasury stock

Treasury stock is accounted for using the par value method.

Share-based compensation

We provide share-based compensation through non-qualified stock options, restricted stock awards and restricted stock units. We measure compensation cost arising from the grant of share-based payments to an employee at fair value, and recognize such cost in income over the period during which the employee is required to provide service in exchange for the award, usually the vesting period. The fair value of each option award is estimated on the date of grant primarily using the Black-Scholes option valuation model. The assumptions used to estimate fair value require judgment and are subject to change in the future due to factors such as employee exercise behavior, stock price trends, and changes to type or provisions of share-based awards. Any material change in one or more of these assumptions could have an impact on the estimated fair value of a future award.

Black-Scholes Valuation Model Assumptions
(weighted-average)	2021		2020		2019
Risk-free interest rate (a)	0.27	%	1.85	%	2.81	%
Expected term (years) (b)	4		4		4
Expected volatility (c)	33.3	%	30.4	%	28.3	%
Dividend yield (d)	1.60	%	1.12	%	1.24	%

(a) Risk-free interest rates are yields for zero coupon U.S. Treasury notes maturing approximately at the end of the expected option term.

(b)Expected term is based on historical exercise behavior and on the terms and conditions of the stock option award.

(c)Expected volatility is based on a combination of historical volatility, using Monro stock prices over a period equal to the expected term, and implied market volatility.

(d)Dividend yield is based on historical dividend experience and expected future changes, if any.

The fair value of restricted stock awards and restricted stock units (collectively “restricted stock”) is determined based on the stock price at the date of grant.

We are required to estimate forfeitures and only record compensation costs for those awards that are expected to vest. The assumptions for forfeitures were determined based on type of award and historical experience. Forfeiture assumptions are adjusted at the point in time a significant change is identified, with any adjustment recorded in the period of change, and the final adjustment at the end of the requisite service period to equal actual forfeitures.

We recognize compensation expense related to stock options and restricted stock using the straight-line approach. Option awards and restricted stock generally vest equally over the service period established in the award, typically three years or four years. In 2020 and 2019, the Company issued a limited number of restricted stock units to members of senior management which may vest upon the achievement of a three year average return on invested capital target.

Earnings per common share

Basic earnings per common share amounts are calculated by dividing income available to common shareholders, after deducting preferred stock dividends, by the weighted average number of shares of common stock outstanding. Diluted earnings per common share amounts are calculated by dividing net income by the weighted average number of shares of common stock and common stock equivalents outstanding. Common stock equivalents represent shares issuable upon the assumed exercise of common stock options outstanding.

Advertising

The cost of advertising is generally expensed at the first time the advertising takes place, except for direct response advertising which is capitalized and amortized over its expected period of future benefit.

Direct response advertising consists primarily of coupons for Monro’s services. The capitalized costs of this advertising are amortized over the period of the coupon’s validity, which is typically two months.

Prepaid advertising at March 27, 2021 and March 28, 2020, and advertising expense for 2021, 2020 and 2019, were not material to these financial statements.

Vendor rebates

We receive vendor support in the form of allowances through a variety of vendor-sponsored programs, such as volume rebates, promotions, and advertising allowances, referred to as “vendor rebates”. Vendor rebates are recorded as a reduction of cost of sales.

We establish a receivable for vendor rebates that are earned but not yet received. Based on purchase data and the terms of the applicable vendor-sponsored programs, we estimate the amount earned. The majority of the year-end vendor rebates receivable is collected within the following first quarter. See Note 4 for additional information.

 

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Impact Of The COVID-19 Pandemic

12 Months Ended

Mar. 27, 2021

Impact Of The COVID-19 Pandemic [Abstract]

Impact Of The COVID-19 Pandemic

Note 2 – Impact of the COVID-19 Pandemic

In response to the unprecedented and rapid spread of COVID-19, many U.S. state governments, in states in which we operate, enacted stay-at-home restrictions and social distancing measures during fiscal 2021. State and local governments ordered restrictions on the operations of certain businesses, including temporary closures of some businesses, and numerous other businesses temporarily closed voluntarily or transitioned their workforces to working remotely.

Further, individuals’ ability to travel was curtailed through mandated travel restrictions. Throughout 2021, store traffic changed significantly and unpredictably in reaction to the COVID-19 pandemic. Substantially all Company-operated retail stores operated under a reduced schedule throughout the year to match demand.

Given the uncertainties surrounding the impacts of the COVID-19 pandemic on our future financial condition, results of operations and cash flows, we have taken a number of actions in response to prevailing uncertain market conditions. In order to enhance our liquidity position, we took a precautionary measure and borrowed $350 million available to us under our Credit Facility (as defined in Note 7 below) in March 2020. We subsequently repaid the $350 million previously borrowed in March 2020 during 2021.

Additionally, we negotiated rent deferrals for a significant number of our stores, as well as other rent reductions. See additional discussion of these rent deferrals and reductions in Note 15.

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Acquisitions

12 Months Ended

Mar. 27, 2021

Acquisitions [Abstract]

Acquisitions

Note 3 – Acquisitions

Monro’s acquisitions are strategic moves in our plan to fill in and expand our presence in our existing and contiguous markets, expand into new markets and leverage fixed operating costs such as distribution, advertising and administration. Acquisitions in this footnote include acquisitions of five or more locations as well as acquisitions of one to four locations that are part of our greenfield store growth strategy.

Subsequent Event

On April 25, 2021, we acquired 30 retail tire and automotive repair stores located in California from Mountain View Tire & Service, Inc. These stores will operate under the Mountain View Tire & Service name. The acquisition was financed through our Credit Facility.

2021

On December 6, 2020, we acquired 17 retail tire and automotive repair stores located in California from Fred Allen Enterprises, Inc. for $17.1 million. These stores will operate under the Tire Choice name. The acquisition was financed through our Credit Facility. The results of operation for the acquisition are included in our financial results from the acquisition date.

Prior to this acquisition, our acquisition activity was paused due to the impact of the COVID-19 pandemic.

The acquisition resulted in goodwill related to, among other things, growth opportunities, synergies and economies of scale expected from combining the business with ours, as well as unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded a customer list intangible asset with a useful life of seven years at its estimated fair value of approximately $0.4 million. We have recorded acquired ROU assets at the present value of remaining lease payments adjusted to reflect favorable or unfavorable market terms of the lease.

We expensed all costs related to the acquisition during 2021. The total costs related to the completed acquisition were $0.3 million and these costs are included in the Consolidated Statement of Income and Comprehensive Income primarily under OSG&A expenses.

Sales and net income related to the completed acquisition totaled $5.8 million and $0.1 million, respectively for the period from acquisition date through March 27, 2021. The net income of $0.1 million includes an allocation of certain traditional corporate related items, including vendor rebates, interest expense and income taxes.

Supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entity was not owned by Monro.

We accounted for the acquisition as a business combination using the acquisition method of accounting in accordance with the FASB ASC Topic 805, “Business Combinations.” The acquired assets and liabilities assumed were recorded at their acquisition-date fair values and were consolidated with those of the Company as of the acquisition date. The acquisition-date fair values were assigned based on preliminary valuations and estimates, and the consideration transferred and net liabilities assumed were recorded as goodwill.

2021 Acquisition-date Fair Values Assigned
(thousands)
Inventory	$	1,046
Other current assets		172
Property and equipment		674
Finance lease and financing obligation assets, net		5,089
Operating lease assets, net		8,980
Intangible asset		418
Other non-current assets		30
Long-term deferred income tax assets		1,331
Total assets acquired		17,740
Current portion of finance leases and financing obligations		748
Current portion of operating lease liabilities		976
Deferred revenue		697
Other current liabilities		4
Long-term finance leases and financing obligations		7,911
Long-term operating lease liabilities		7,433
Other long-term liabilities		536
Total liabilities assumed		18,305
Total net identifiable liabilities assumed	$	(565)
Total consideration transferred	$	17,112
Less: total net identifiable liabilities assumed		(565)
Goodwill	$	17,677

The total consideration of $17.1 million is comprised of $16.3 million in cash, and a $0.8 million payable to the seller. The payable is due upon finalization of a lease assignment for one store location.

We continue to refine the valuation data and estimates primarily related to inventory, warranty reserves, intangible assets and real property leases and certain liabilities for the 2021 acquisition and expect to complete the valuations no later than the first anniversary date of the acquisition. We anticipate that adjustments will continue to be made to the fair values of identifiable assets acquired and liabilities assumed and those adjustments may or may not be material.

2020

During 2020, we acquired the following businesses for an aggregate purchase price of $103.7 million. The acquisitions were financed through our Credit Facility. The results of operations for these acquisitions are included in our financial results from the respective acquisition dates.

On November 17, 2019, we acquired 18 retail tire and automotive repair stores located in Nevada and Idaho from Nevada Tire Holdings, LLC and Idaho Tire Holdings, LLC. These stores operate under the Tire Choice name.

On October 27, 2019, we acquired six retail tire and automotive repair stores located in California from S & S Unlimited, Inc. Once converted, expected in fiscal 2022, these stores will operate under the Tire Choice name.

On October 27, 2019, we acquired three retail tire and automotive repair stores located in California from Lloyd’s Tire Service, Inc. Once converted, expected in fiscal 2022, these stores will operate under the Tire Choice name.

On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Atlas Tire Center, Inc. This store operates under the Tire Choice name.

On August 25, 2019, we acquired two retail tire and automotive repair stores located in Louisiana from LRZ3 Auto, LLC. These stores operate under the Tire Choice name.

On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from T-Boy's Tire and Automotive, LLC. This store operates under the Tire Choice name.

On August 25, 2019, we acquired two retail tire and automotive repair stores located in Louisiana from Twin Tire & Auto Care, Inc. These stores operate under the Tire Choice name.

On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Twin Tire & Auto Care Team, Inc. This store operates under the Tire Choice name.

On August 25, 2019, we acquired one retail tire and automotive repair store located in Louisiana from Scotty's Tire & Automotive, Inc. This store operates under the Tire Choice name.

On June 23, 2019, we acquired two retail tire and automotive repair stores located in California from BAW LLC. These stores operate under the Tire Choice name.

On May 19, 2019, we acquired 40 retail tire and automotive repair stores and one distribution center located in California from Certified Tire & Service Centers, Inc. These stores operate under the Tire Choice name.

On March 31, 2019, we acquired 12 retail tire and automotive repair stores located in Louisiana from Allied Discount Tire & Brake, Inc. These stores operate under the Tire Choice name.

These acquisitions resulted in goodwill related to, among other things, growth opportunities, synergies and economies of scale expected from combining these businesses with ours, as well as unidentifiable intangible assets. All of the goodwill is expected to be deductible for tax purposes. We have recorded certain customer list intangible assets with an average useful life of seven years at their total estimated fair value of approximately $2.8 million. We have recorded acquired ROU assets at the present value of remaining lease payments adjusted to reflect favorable or unfavorable market terms of the lease.

We expensed all costs related to these acquisitions during 2020. The total costs related to the completed acquisitions were $1.4 million for the year ended March 28, 2020. These costs are included in the Consolidated Statement of Income and Comprehensive Income primarily under OSG&A expense.

Sales and net loss for the 2020 acquired locations totaled $59.3 million and ($3.9) million, respectively, for the period from acquisition date through March 28, 2020. The net loss of ($3.9) million includes an allocation of certain traditional corporate related items, including vendor rebates, interest expense and the benefit from income taxes.

Supplemental pro forma information for the current or prior reporting periods has not been presented due to the impracticability of obtaining detailed, accurate or reliable data for the periods the acquired entities were not owned by Monro.

We accounted for each 2020 acquisition as a business combination using the acquisition method of accounting and we finalized the purchase accounting related to the 2020 acquisitions during 2021. As a result of the final purchase accounting, certain of the fair value amounts previously estimated were adjusted during the measurement period. These measurement period adjustments resulted from updated valuation reports and appraisals received from our external valuation specialists, as well as revisions to internal estimates. The measurement period adjustments were not material to the Consolidated Balance Sheet as of March 27, 2021 and March 28, 2020 and the Consolidated Statement of Income and Comprehensive Income for 2021 and 2020.

The acquired assets and liabilities assumed were recorded at their assigned acquisition-date fair values and were consolidated with those of the Company as of the acquisition date. The consideration transferred and net liabilities assumed were recorded as goodwill.

2020 Acquisition-date Fair Values Assigned
(thousands)
Inventories	$	4,433
Other current assets		706
Property and equipment		2,405
Finance lease and financing obligation assets, net		29,147
Operating lease assets, net		42,680
Intangible assets		2,847
Other non-current assets		374
Long-term deferred income tax assets		4,870
Total assets acquired		87,462
Current portion of finance leases and financing obligations		2,672
Current portion of operating lease liabilities		4,416
Deferred revenue		1,618
Other current liabilities		358
Long-term finance leases and financing obligations		36,225
Long-term operating lease liabilities		43,668
Other long-term liabilities		1,747
Total liabilities assumed		90,704
Total net identifiable liabilities assumed	$	(3,242)
Total consideration transferred	$	103,692
Less: total net identifiable liabilities assumed		(3,242)
Goodwill	$	106,934

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Other Current Assets

12 Months Ended

Mar. 27, 2021

Other Current Assets [Abstract]

Other Current Assets

Note 4 – Other Current Assets

Other Current Assets
(thousands)		March 27, 2021		March 28, 2020
Vendor rebates receivable	$	15,068	$	16,232
Other		33,047		24,305
Total	$	48,115	$	40,537

 

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Property and Equipment

12 Months Ended

Mar. 27, 2021

Property and Equipment [Abstract]

Property and Equipment

Note 5 – Property and Equipment

The major classifications of property, plant and equipment are as follows:

Property and Equipment
(thousands)		March 27, 2021		March 28, 2020
Land	$	84,485	$	84,765
Buildings and improvements		289,328		272,724
Equipment, signage and fixtures		291,179		278,324
Vehicles		37,684		38,356
Construction-in-progress		7,073		8,763
Property and equipment		709,749		682,932
Less - Accumulated depreciation		382,686		354,295
Property and equipment, net	$	327,063	$	328,637

Depreciation expense totaled $42.9 million, $39.2 million and $35.5 million for 2021, 2020 and 2019, respectively.

 

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Goodwill and Intangible Assets

12 Months Ended

Mar. 27, 2021

Goodwill and Intangible Assets [Abstract]

Goodwill and Intangible Assets

Note 6 – Goodwill and Intangible Assets

Reconciliation of Changes in Goodwill
(thousands)		2021		2020
Balance at beginning of period	$	671,843	$	565,503
Current fiscal year acquisitions		17,677		106,930
Adjustments to prior fiscal year acquisitions		4		(590)
Balance at end of period	$	689,524	$	671,843

Intangible Assets	March 27, 2021				March 28, 2020
		Gross		Accumulated		Gross		Accumulated
(thousands)		Carrying Amount		Amortization		Carrying Amount		Amortization
Customer lists	$	36,000	$	21,932	$	42,511	$	26,333
Trade names		18,452		10,321		21,252		12,072
Franchise agreements		7,100		3,231		7,220		2,805
Other intangible assets		50		50		590		582
Total	$	61,602	$	35,534	$	71,573	$	41,792

Estimated Weighted Average Useful Lives	Life (Years)
Customer lists	10
Trade names	15
Franchise agreements	13
Other intangible assets	20

Amortization expense was $4.1 million, $4.8 million and $5.3 million for 2021, 2020 and 2019, respectively.

Estimated Future Amortization Expense
(thousands)		Amortization
2022	$	3,838
2023		3,583
2024		3,223
2025		2,866
2026		2,646

 

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Long-Term Debt	12 Months Ended
	Mar. 27, 2021
Long-Term Debt [Abstract]
Long-Term Debt	Note 7 – Long-term Debt Credit Facility In April 2019, we entered into a new five year $600 million revolving credit facility agreement with eight banks (the “Credit Facility”). Interest only is payable monthly throughout the Credit Facility’s term. The borrowing capacity for the Credit Facility of $600 million includes an accordion feature permitting us to request an increase in availability of up to an additional $250 million. The Credit Facility bears interest at 75 to 200 basis points over LIBOR (or replacement index) or at the prime rate, depending on the type of borrowing and the rates then in effect. On June 11, 2020, we entered into a First Amendment to the Credit Facility (the “First Amendment”), which, among other things, amended the terms of certain of the financial and restrictive covenants in the credit agreement through the first quarter of 2022 to provide us with additional flexibility to operate our business. The First Amendment permanently amended the interest rate charged on borrowings to be based on the greater of adjusted one-month LIBOR or 0.75 percent. For the period from June 30, 2020 to June 30, 2021, the minimum interest rate spread charged on borrowings will be 225 basis points over LIBOR. Additionally, during the same period, we may declare, make or pay any dividend or distribution up to $38.5 million in the aggregate and the acquisition of stores or other businesses up to $100 million in the aggregate are permitted if we are in compliance with the financial covenants and other restrictions in the First Amendment and Credit Facility. The Credit Facility requires fees payable quarterly throughout the term between 0.125 percent and 0.35 percent of the amount of the average net availability under the Credit Facility during the preceding quarter. Except as amended by the First Amendment, the remaining terms of the credit agreement remain in full force and effect. At March 27, 2021 and March 28, 2020, the interest rate spread paid by the Company was 225 basis points and 100 basis points over LIBOR, respectively. Within the Credit Facility, we have a sub-facility of $80 million available for the purpose of issuing standby letters of credit. The sub-facility requires fees aggregating 87.5 to 212.5 basis points annually of the face amount of each standby letter of credit, payable quarterly in arrears. There was a $33.6 million outstanding letter of credit at March 27, 2021. Mortgages and specific lease financing arrangements with other parties (with certain limitations) are permitted under the Credit Facility. Other specific terms and the maintenance of specified ratios are generally consistent with our prior financing agreement that was replaced with the new agreement entered into in April 2019. Additionally, the Credit Facility is not secured by our real property, although we have agreed not to encumber our real property, with certain permissible exceptions. There was $190.0 million outstanding and $376.4 million available under the Credit Facility at March 27, 2021. We were in compliance with all debt covenants at March 27, 2021. Long-term debt had a carrying amount and a fair value of $190.0 million as of March 27, 2021, as compared to a carrying amount and a fair value of $566.4 million as of March 28, 2020. The carrying value of our debt approximated its fair value due to the variable interest nature of the debt.

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Revenue

12 Months Ended

Mar. 27, 2021

Revenue [Abstract]

Revenue

Note 8 – Revenue

Automotive undercar repair, tire replacement sales and tire related services represent the vast majority of our revenues. We also earn revenue from the sale of tire road hazard warranty agreements as well as commissions earned from the delivery of tires on behalf of certain tire vendors.

Revenue from automotive undercar repair, tire replacement sales and tire related services is recognized at the time the customers take possession of their vehicle or merchandise. For sales to certain customers that are financed through the offering of credit on account, payment terms are established for customers based on our pre-established credit requirements. Payment terms vary depending on the customer and generally range from 15 to 45 days. Based on the nature of receivables, no significant financing components exist. Sales are recorded net of discounts, sales incentives and rebates, sales taxes and estimated returns and allowances. We estimate the reduction to sales and cost of sales for returns based on current sales levels and our historical return experience. Such amounts are immaterial to our consolidated financial statements.

Revenues
(thousands)		2021		2020		2019
Brakes	$	130,179	$	169,138	$	162,709
Exhaust		20,201		25,058		28,713
Steering		85,290		100,230		95,711
Tires (a)		617,815		634,513		601,295
Maintenance		269,337		324,494		308,668
Other		2,899		3,091		3,134
Total	$	1,125,721	$	1,256,524	$	1,200,230

(a) Includes the sale of tire road hazard warranty agreements and tire delivery commissions.

Revenue from the sale of tire road hazard warranty agreements is initially deferred and is recognized over the contract period as costs are expected to be incurred in performing such services, typically 21 to 36 months. The deferred revenue balances at March 27, 2021 and March 28, 2020 were $16.7 million and $18.5 million, respectively, of which $12.0 million and $13.1 million, respectively, are reported in Deferred revenue and $4.7 million and $5.4 million, respectively, are reported in Other long-term liabilities in our Consolidated Balance Sheets.

Changes in Deferred Revenue
(thousands)		2021		2020
Balance at beginning of period	$	18,506	$	17,150
Deferral of revenue		14,958		17,466
Deferral of revenue from acquisitions		1,225		2,916
Recognition of revenue		(17,977)		(19,026)
Balance at end of period	$	16,712	$	18,506

We expect to recognize $12.0 million of deferred revenue related to road hazard warranty agreements during our fiscal year ending March 26, 2022, and $4.7 million of such deferred revenue thereafter.

Under various arrangements, we receive from certain tire vendors a delivery commission and reimbursement for the cost of the tire that we may deliver to customers on behalf of the tire vendor. The commission we earn from these transactions is as an agent and the net amount retained is recorded as sales.

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Income Taxes

12 Months Ended

Mar. 27, 2021

Income Taxes [Abstract]

Income Taxes

Note 9 – Income Taxes

Provision for Income Taxes
(thousands)		2021		2020		2019
Current:
Federal	$	(1,809)	$	2,783	$	5,682
State		827		1,994		2,409
Total current		(982)		4,777		8,091
Deferred:
Federal		10,169		11,397		11,563
State		685		76		954
Total deferred		10,854		11,473		12,517
Total provision	$	9,872	$	16,250	$	20,608

Income Tax Rate Reconciliation	2021		2020		2019
Expected U.S. federal income taxes at statutory rate	21.0	%	21.0	%	21.0	%
State income taxes, net of federal tax benefit	2.9		1.9		2.8
Tax settlements and adjustments (a)	(1.1)		—		(1.9)
Other	(0.5)		(1.0)		(1.4)
Effective tax rate	22.3	%	21.9	%	20.5	%

(a)For 2021, adjustments reflect benefit due to differences in statutory tax rates from loss years to years in which net operating losses may be carried back. For 2019, settlements reflect benefit from Internal Revenue Service’s examination of our 2016 and 2017 tax returns.

Net Deferred Tax Asset/(Liability)
(thousands)		March 27, 2021		March 28, 2020
Gross deferred tax assets:
Lease liabilities	$	186,168	$	169,366
Insurance reserves		11,441		10,192
Other		15,282		14,765
Total gross deferred tax assets		212,891		194,323
Gross deferred tax liabilities:
Leased assets		(148,496)		(131,484)
Goodwill		(56,623)		(47,204)
Property and equipment		(21,032)		(18,232)
Other		(910)		(1,288)
Total deferred tax liabilities		(227,061)		(198,208)
Total net deferred tax liability	$	(14,170)	$	(3,885)

We have $7.5 million of state net operating loss carryforwards and $3.5 million of federal net operating loss carrybacks available as of March 27, 2021. The state net operating loss carryforwards expire in varying amounts through 2041. The federal net operating loss may be carried back to 2016, as permitted under the CARES Act.

We evaluate the realizability of our deferred tax assets on a quarterly basis and establish valuation allowances when it is more likely than not that all or a portion of a deferred tax asset may not be realized. As of March 27, 2021, we concluded, based on the weight of all available positive and negative evidence, that all of our deferred tax assets are more likely than not to be realized.

Changes in Liability for Unrecognized Tax Benefits
(thousands)		2021		2020		2019
Balance at beginning of period	$	5,212	$	6,424	$	6,209
Additions based on tax positions related to the current year		915		644		1,178
Additions for tax positions of prior years		—		—		166
Reductions for tax positions of prior years		—		(30)		(6)
Settlements		—		—		—
Lapse in statutes of limitation		(1,092)		(1,826)		(1,123)
Balance at end of period	$	5,035	$	5,212	$	6,424

The total amount of unrecognized tax benefits was $5.0 million, $5.2 million and $6.4 million at March 27, 2021, March 28, 2020 and March 30, 2019, respectively, the majority of which, if recognized, would affect the effective tax rate.

In the normal course of business, Monro provides for uncertain tax positions and the related interest and penalties, and adjusts its unrecognized tax benefits and accrued interest and penalties and, accordingly, we had approximately $0.2 million and $0.3 million of interest and penalties associated with uncertain tax benefits accrued as of March 27, 2021 and March 28, 2020, respectively.

We file U.S. federal income tax returns and income tax returns in various state jurisdictions. Monro’s fiscal 2020, 2019 and 2018 U.S. federal tax year and various state tax years remain subject to income tax examinations by tax authorities.

 

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Stock Ownership	12 Months Ended
	Mar. 27, 2021
Stock Ownership [Abstract]
Stock Ownership	Note 10 – Stock Ownership Holders of at least 60 percent of the Class C preferred stock must approve any action authorized by the holders of Common Stock. In addition, there are certain restrictions on the transferability of shares of Class C preferred stock. In the event of a liquidation, dissolution or winding-up of Monro, the holders of the Class C preferred stock would be entitled to receive $1.50 per share out of the assets of Monro before any amount would be paid to holders of Common Stock. The conversion value of the Class C convertible preferred stock was $0.064 per share at March 27, 2021 and March 28, 2020.

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Share Based Compensation

12 Months Ended

Mar. 27, 2021

Share Based Compensation [Abstract]

Share Based Compensation

Note 11 – Share-based Compensation

We maintain a long-term incentive plan whereby eligible employees and non-employee directors may be granted non-qualified service condition stock options, non-qualified market condition stock options, restricted stock awards and restricted stock units. We grant share-based awards to continue to attract and retain employees and to better align employees’ interests with those of our shareholders. Monro issues new shares of Common Stock upon the exercise of stock options.

Share-based compensation expense included in cost of sales and OSG&A expense in Monro’s Consolidated Statements of Income and Comprehensive Income for 2021, 2020 and 2019 was $2.4 million, $3.8 million and $4.0 million, respectively, and the related income tax benefit for each year was $0.6 million, $0.9 million and $1.0 million, respectively.

Monro currently grants stock option awards and restricted stock under the 2007 Incentive Stock Option Plan (the “2007 Plan”), as amended and restated effective August 2017. At March 27, 2021, there were a total of 5,001,620 shares and 1,064,945 shares that were authorized and available for grant under the 2007 Plan, respectively.

Non-Qualified Stock Options

Generally, employee options vest over a four year period, and have a duration of six years. Outstanding options are exercisable for various periods through March 2027.

Stock Option Activity				Weighted-average
				Remaining
	Stock		Weighted-average	Contractual		Aggregate Intrinsic
	Options		Exercise Price	Term (years)		Value (a)
Outstanding as of March 28, 2020	802,766	$	58.55
Granted	166,193		55.29
Exercised	(130,998)		47.93
Canceled	(324,094)		56.14
Outstanding as of March 27, 2021	513,867	$	61.75	3.12	$	3,483,001
Vested and exercisable as of March 27, 2021	286,549	$	61.30	1.93	$	1,805,603

(a)Total shares valued at the market price of the underlying stock as of March 27, 2021 less the exercise price.

As of March 27, 2021, the total unrecognized compensation expense related to unvested stock option awards was $2.7 million, which is expected to be recognized over a weighted average period of approximately three years. The weighted-average grant date fair value of options granted during 2021, 2020 and 2019 was $12.53, $18.92 and $15.44, respectively. The total fair value of stock options vested during 2021, 2020 and 2019 was $2.0 million, $2.0 million and $2.8 million, respectively.

Stock Option Exercises
(millions)		2021		2020		2019
Total intrinsic value of stock options exercised	$	1.5	$	2.9	$	7.4
Cash received for exercise price		6.3		6.2		14.6
Income tax benefit		—		0.4		1.0

Stock Options Outstanding	Options Outstanding				Options Exercisable
and Exercisable		Weighted-				Weighted-
		average		Weighted-		average		Weighted-
	Shares	Remaining		average	Shares	Remaining		average
	Outstanding	Contractual		Exercise	Exercisable	Contractual		Exercise
Range of Exercise Prices	at 3/27/2021	Term (years)		Price	at 3/27/2021	Term (years)		Price
$40.71 - $55.15	129,817	3.77	$	50.86	53,993	2.35	$	47.88
$55.16 - $57.78	131,696	2.93		56.97	66,393	0.86	$	57.28
$57.79 - $66.90	134,126	2.36		64.38	113,151	2.03	$	64.37
$66.91 - $87.17	118,228	3.49		76.04	53,012	2.62	$	73.44

Restricted Stock

Monro issues restricted stock to certain members of senior management as well as non-employee directors of the Company. Restricted stock units represent shares issued upon vesting in the future whereas restricted stock awards represent shares issued upon grant that are restricted. The fair value for restricted stock units and restricted stock awards is calculated based on the stock price on the date of grant. Restricted stock units do not have voting rights but earn dividends during the vesting period. The recipients of the restricted stock awards have voting rights and earn dividends during the vesting period. The dividends are paid to the recipient at the time the restricted stock becomes vested. If the recipient leaves Monro prior to the vesting date for any reason, the shares of restricted stock and the dividends accrued on those shares will be forfeited and returned to Monro. The restricted stock units and awards vest equally over three years or four years. In 2020 and 2019, the Company issued a limited number of restricted stock units to members of senior management which may vest upon the achievement of a three year average return on invested capital target.

Subsequent to fiscal 2021, the Company granted 40,000 restricted stock units in connection with the appointment of its new President and Chief Executive Officer effective April 5, 2021. The restricted stock units will vest upon time or the Company’s common stock price meeting certain market conditions between April 2021 and December 2023.

Non-vested Restricted Stock Activity			Weighted-average
	Restricted Stock		Grant-date
	Shares		Fair Value per Share
Outstanding as of March 28, 2020	55,730	$	64.96
Granted	35,019		52.75
Vested	(26,333)		56.52
Forfeited	(12,703)		63.90
Outstanding as of March 27, 2021	51,713	$	61.24

As of March 27, 2021, the total unrecognized compensation expense related to unvested restricted stock shares was $1.4 million, which is expected to be recognized over a weighted average period of approximately two years. The weighted-average grant date fair value of restricted stock shares granted during 2021, 2020 and 2019 was $52.75, $75.33 and $67.80, respectively. The total fair value of restricted stock shares vested during 2021, 2020 and 2019 was $1.4 million, $1.8 million and $1.0 million, respectively.

 

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Earnings Per Common Share

12 Months Ended

Mar. 27, 2021

Earnings Per Common Share [Abstract]

Earnings Per Common Share

Note 12 – Earnings per Common Share

Earnings per Common Share
(thousands, except per share data)		2021		2020		2019
Numerator for earnings per common share calculation:
Net income	$	34,319	$	58,024	$	79,752
Less: Preferred stock dividends		(438)		(449)		(408)
Income available to common stockholders	$	33,881	$	57,575	$	79,344
Denominator for earnings per common share calculation:
Weighted average common shares - basic		33,329		33,246		32,980
Effect of dilutive securities:
Preferred stock		503		510		510
Stock options		26		167		154
Restricted stock		18		30		31
Weighted average common shares - diluted		33,876		33,953		33,675
Basic earnings per common share	$	1.02	$	1.73	$	2.41
Diluted earnings per common share	$	1.01	$	1.71	$	2.37

The computation of diluted earnings per common share for 2021, 2020 and 2019 excludes the effect of assumed exercise of approximately 456,000, 177,000 and 146,000 of stock options, respectively, as the exercise price of these options was greater than the average market value of our common stock for those periods, resulting in an anti-dilutive effect on diluted earnings per common share.

 

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Leases

12 Months Ended

Mar. 27, 2021

Leases [Abstract]

Leases

Note 13 – Leases

We lease certain retail stores, distribution centers, office space and land as well as service contracts that are considered leases.

Our leases have remaining lease terms, including renewals reasonably certain to be exercised, of less than one year to approximately 37 years. Most of our leases include one or more options to extend the lease, for periods ranging from three years to 25 years or more.

Historical failed sale leasebacks that were assumed through acquisitions and do not qualify for sale leaseback accounting continue to be accounted for as financing obligations. As of March 27, 2021 and March 28, 2020, net assets of $4.4 million and $4.5 million, respectively, and liabilities of $7.2 million and $7.5 million, respectively, due to failed sale leaseback arrangements were included with finance lease assets and liabilities, respectively, on the Consolidated Balance Sheets.

Lease Cost
(thousands)		2021		2020
Operating lease cost	$	35,998	$	38,525
Finance lease/financing obligations cost:
Amortization of leased assets		30,428		21,033
Interest on lease liabilities		18,344		21,330
Short term and variable lease cost		321		2,194
Sublease income		(95)		(166)
Total lease cost	$	84,996	$	82,916

As reported under the previous accounting standard, net rental expense and amortization of finance lease assets was $38.0 million and $14.7 million, respectively, for 2019.

Maturity of Lease Liabilities				Finance Leases and
(thousands)		Operating Leases (a)		Financing Obligations (b)
2022	$	36,451	$	55,389
2023		34,381		55,487
2024		31,685		54,405
2025		28,414		51,494
2026		25,161		48,992
Thereafter		83,454		250,812
Total undiscounted lease obligations	$	239,546	$	516,579
Less: imputed interest		(30,919)		(112,446)
Present value of lease obligations	$	208,627	$	404,133

(a)Operating lease obligations include $61.0 million related to options to extend operating leases that are reasonably certain of being exercised.

(b)Finance lease payments include $108.4 million related to options to extend finance leases that are reasonably certain of being exercised.

Total lease payments exclude $2.4 million of legally binding minimum lease payments for leases signed but not yet commenced.

Lease Term and Discount Rate	2021		2020
Weighted average remaining lease term (years)
Operating leases	8.6		9.4
Finance leases and financing obligations	10.3		9.9
Weighted average discount rate
Operating leases	2.96	%	3.51	%
Finance leases and financing obligations	6.20	%	8.73	%

Other Information
(thousands)		2021		2020
Cash paid for amounts included in measurement of lease obligations:
Operating cash flows from operating leases	$	34,931	$	36,808
Operating cash flows from finance leases and financing obligations		18,602		21,340
Financing cash flows from finance leases and financing obligations		33,032		27,212

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Defined Benefit and Defined Contribution Plans

12 Months Ended

Mar. 27, 2021

Defined Benefit and Defined Contribution Plans [Abstract]

Defined Benefit and Defined Contribution Plans

Note 14 – Defined Benefit and Defined Contribution Plans

Defined Benefit Plan

We have a defined benefit pension plan covering employees who meet eligibility requirements. This plan is closed to new participants. Eligibility and the level of benefits under the plan are primarily dependent on date of hire, age, length of service and compensation. The funding policy for our plan is consistent with the funding requirements of U.S. federal law and regulations. The measurement date used to determine the pension plan measurements disclosed herein is March 31 for both 2021 and 2020.

The underfunded status of Monro’s defined benefit plan is recognized as an Other long-term liability in the Consolidated Balance Sheets as of March 27, 2021 and March 28, 2020, respectively.

Underfunded Status
(thousands)		2021		2020
Projected benefit obligations	$	22,096	$	21,646
Fair value of plan assets		21,666		18,611
Underfunded status	$	(430)	$	(3,035)

Contributions and Estimated Future Benefit Payment

Our obligations to plan participants can be met over time through a combination of company contributions to these plans and earnings on plan assets. There are no required or expected contributions in fiscal 2022 to the plan. However, depending on investment performance and plan funded status, we may elect to make a contribution.

Estimated Future Benefit Payments
(thousands)		Pension Benefits
2022	$	1,065
2023		1,098
2024		1,114
2025		1,147
2026		1,188
2027 - 2031		6,322

Cost of Plans

Net Pension Benefits Expense (Income)
(thousands)		2021		2020		2019
Interest cost on projected benefit obligation	$	692	$	752	$	781
Expected return on plan assets		(1,162)		(1,423)		(1,409)
Amortization of unrecognized actuarial loss		892		455		403
Total	$	422	$	(216)	$	(225)

Assumptions

Benefit Obligation Weighted Average Assumption	2021		2020
Discount rate	3.01	%	3.34	%

Net Periodic Benefit Expense Weighted Average Assumptions	2021		2020		2019
Discount rate	3.34	%	3.72	%	3.89	%
Expected long-term rate of return on plan assets	6.50	%	7.00	%	7.00	%

Our expected long-term rate of return on plan assets assumption is based upon historical returns and the future expectations for returns for each asset class, as well as the target asset allocation of the pension portfolio.

Benefit Obligation

Change in Projected Benefit Obligation
(thousands)		2021		2020
Benefit obligation at beginning of year	$	21,646	$	20,972
Interest cost		692		752
Actuarial loss		391		642
Benefits paid		(633)		(720)
Benefit obligation at end of year (a)	$	22,096	$	21,646

(a) Accumulated benefit obligation-the present value of benefits earned to date assuming no future salary growth-is materially consistent with the projected benefit obligation in each period presented.

Plan Assets

Change in Plan Assets
(thousands)		2021		2020
Fair value of plan assets at beginning of year	$	18,611	$	20,838
Actual return (loss) on plan assets		3,688		(1,507)
Benefits paid		(633)		(720)
Fair value of plan assets at end of year	$	21,666	$	18,611

Our asset allocation strategy is to conservatively manage the assets in order to meet the plan’s long-term obligations while maintaining sufficient liquidity to pay current benefits. This is achieved by holding equity investments while investing a portion of assets in long duration bonds to match the long-term nature of the liabilities.

Asset Category	Current Targeted		Actual Allocation
	Allocation		2021		2020
Cash and cash equivalents			53.3	%	4.1	%
Fixed income	50.0	%	24.7	%	37.9	%
Equity securities	50.0	%	22.0	%	58.0	%
Total	100.0	%	100.0	%	100.0	%

The allocation of assets as of March 2021 was weighted heavier in cash and cash equivalents as the Plan’s assets were transferred from its previous custodian to a new custodian late in 2021 by the Plan’s new asset manager. As such, cash and cash equivalent assets were being reinvested into new assets in accordance with our asset allocation strategy late in fiscal 2021 and into 2022.

Fair Value Measurements		Fair Value at
(thousands)	Pricing Category (a)		March 27, 2021		March 28, 2020
Cash equivalents	Level 1	$	11,542	$	761
Equity securities:
U.S. companies	Level 1		3,372		7,383
U.S. companies	Level 2		—		283
International companies	Level 1		1,391		3,137
Fixed income:
U.S. corporate bonds	Level 2		5,361		6,686
International bonds	Level 2		—		361
Total plan assets		$	21,666	$	18,611

(a) Fair value measurements are reported in one of three levels based on the lowest level of significant input used: Level 1 (unadjusted quoted prices in active markets); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data).

Amounts included in Shareholders’ Equity

Amounts in Accumulated Other Comprehensive Loss
(thousands)		2021		2020
Unamortized net actuarial loss	$	6,147	$	9,174
Amounts in Accumulated Other Comprehensive Loss (a)	$	6,147	$	9,174

(a) $4,619 and $6,889, net of tax, at the end of 2021 and 2020, respectively.

Amounts included in Comprehensive Income

Amounts in Other Comprehensive Income (Loss)
(thousands)		2021		2020		2019
Net actuarial income (loss)	$	3,027	$	(3,117)	$	(382)
Amounts in Other Comprehensive Income (Loss) (a)	$	3,027	$	(3,117)	$	(382)

(a) $2,270, ($2,353) and ($288), net of tax, during 2021, 2020 and 2019, respectively.

Defined Contribution Plan

Our employees are eligible to participate in a defined contribution 401(k) plan that covers full-time employees who meet the age and service requirements of the plan. The plan is funded by employee and employer contributions. We match 50 percent of the first 6 percent of employee contributions. Employer contributions totaled approximately $1.6 million, $1.7 million and $1.4 million for 2021, 2020 and 2019, respectively. We may also make annual profit sharing contributions to the plan at the discretion of Monro’s Compensation Committee of the Board of Directors.

In addition, we maintain a deferred compensation plan (the “Deferred Compensation Plan”) for a broad management group whose participation in our 401(k) plan is limited by statute or regulation. The Deferred Compensation Plan permits participants to defer all or any portion of the compensation that would otherwise be payable to them for the calendar year. We credit to the participants’ accounts such amounts as would have been contributed to Monro’s 401(k) plan but for the limitations that are imposed by statute or regulation. The Deferred Compensation Plan is an unfunded arrangement and the participants or their beneficiaries have an unsecured claim against the general assets of Monro to the extent of their Deferred Compensation Plan benefits. We maintain accounts to reflect the amounts owed to each participant. At least annually, the accounts are credited with earnings or losses calculated on the basis of an interest rate or other formula as determined by Monro’s Compensation Committee. The total liability recorded in our financial statements at March 27, 2021 and March 28, 2020 related to the Deferred Compensation Plan was approximately $2.1 million and $2.2 million, respectively.

 

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Commitments and Contingencies

12 Months Ended

Mar. 27, 2021

Commitments and Contingencies [Abstract]

Commitments and Contingencies

Note 15 – Commitments and Contingencies

Commitments

Commitments Due by Period				Within		2 to		4 to		After
(thousands)		Total		1 Year		3 Years		5 Years		5 Years
Principal payments on long-term debt	$	190,000					$	190,000
Finance lease commitments/financing obligations (a)		516,579	$	55,389	$	109,892		100,486	$	250,812
Operating lease commitments (a)		239,546		36,451		66,066		53,575		83,454
Accrued rent		1,807		1,563		132		42		70
Other liabilities		1,133		800		333		—		—
Total	$	949,065	$	94,203	$	176,423	$	344,103	$	334,336

(a) Finance and operating lease commitments represent future undiscounted lease payments and include $108.4 million and $61.0 million, respectively, related to options to extend lease terms that are reasonably certain of being exercised.

During 2021, we negotiated rent deferrals, with repayment at later dates, for a significant number of our store leases. These concessions provide a deferral of rent payments with no substantive changes to the original contract. Consistent with updated guidance from the FASB in April 2020, we have elected to treat the rent deferrals as accrued liabilities. The accrued rent reflected in the table above includes $0.8 million related to rent deferrals due primarily in the first and second quarter of 2022 and $1.0 million due to timing of other lease related expenses. We will continue to recognize expense during the deferral periods.

In addition, during 2021, we negotiated rent reductions with certain landlords on approximately 23 percent of our lease contracts in exchange for extending our current lease term. As these agreements represent substantive changes to our contractual obligations, the leases were remeasured. As a result, finance lease and financing obligation assets, net and finance leases and financing obligations were increased by $67.7 million and $64.0 million, respectively, and operating lease assets, net and operating lease liabilities were increased by $16.2 million and $20.0 million, respectively. The negotiated terms were generally consistent with terms of normal renewal agreements.

We believe that we can fulfill our commitments utilizing our cash flow from operations and, if necessary, cash on hand and/or bank financing.

Contingencies

We are currently a party to various claims and legal proceedings incidental to the conduct of our business. If management believes that a loss arising from any of these matters is probable and can reasonably be estimated, we will record the amount of the loss, or the minimum estimated liability when the loss is estimated using a range, and no point within the range is more probable than another. As additional information becomes available, any potential liability related to these matters is assessed and the estimates are revised, if necessary. Litigation is subject to inherent uncertainties, and unfavorable rulings could occur and may include monetary damages. If an unfavorable ruling were to occur, there exists the possibility of a material adverse impact on the financial position and results of operations of the period in which any such ruling occurs, or in future periods.

As disclosed in Part I, Item 3, “Legal Proceedings,” an action has been brought against us by an individual seeking to represent a putative class of store managers for unpaid overtime wages, damages and attorneys’ fees under the Fair Labor Standards Act and class certification under Pennsylvania law for alleged violations of state wage payment laws. Plaintiff alleges that improper deductions were made from store managers’ pay.

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Subsequent Events

12 Months Ended

Mar. 27, 2021

Subsequent Events [Abstract]

Subsequent Events

Note 16 – Subsequent Events

On April 5, 2021, Michael T. Broderick joined Monro as President and Chief Executive Officer. See Note 11 for a discussion of restricted stock units granted subsequent to March 27, 2021.

In May 2021, Monro’s Board of Directors declared a cash dividend of $0.24 per share or share equivalent to be paid to shareholders of record as of June 7, 2021. The dividend will be paid on June 21, 2021.

See Note 3 for a discussion of an acquisition subsequent to March 27, 2021.

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Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies (Policy)

12 Months Ended

Mar. 27, 2021

Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract]

Description of business

Monro had 1,263 Company-operated stores, 96 franchised locations, seven wholesale locations and three retread facilities located in 32 states as of March 27, 2021.

Monro’s operations are organized and managed in one operating segment. The internal management financial reporting that is the basis for evaluation in order to assess performance and allocate resources by our chief operating decision maker consists of consolidated data that includes the results of our retail, commercial and wholesale locations. As such, our one operating segment reflects how our operations are managed, how resources are allocated, how operating performance is evaluated by senior management and the structure of our internal financial reporting.

Principles of consolidation

Principles of consolidation

The consolidated financial statements include the accounts of Monro, Inc. and its direct and indirect subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Management’s use of estimates

Management’s use of estimates

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of financial statements in conformity with such principles requires the use of estimates by management during the reporting period. Actual results could differ from those estimates.

Fiscal year

Fiscal year

We operate on a 52/53 week fiscal year ending on the last Saturday in March. Fiscal years 2021 and 2020 each contained 52 weeks and fiscal year 2019 contained 53 weeks. Unless specifically indicated otherwise, any references to “2021” or “fiscal 2021,” “2020” or “fiscal 2020,” and “2019” or “fiscal 2019” relate to the years ended March 27, 2021, March 28, 2020 and March 30, 2019, respectively.

Recent Accounting Pronouncements

Recent accounting pronouncements

In August 2018, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance which eliminates, adds and modifies certain disclosure requirements for fair value measurements. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2019. Early adoption is permitted. We adopted this guidance during the first quarter of 2021. The adoption of this guidance did not have a material impact on our consolidated financial statements.

In December 2019, the FASB issued new accounting guidance intended to simplify the accounting for income taxes. The new guidance removes certain exceptions to the general principles in Accounting Standards Codification (“ASC”) Topic 740, “Income Taxes,” and amends existing guidance to improve consistent application. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2020. Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

Other recent authoritative guidance issued by the FASB (including technical corrections to the ASC) and the Securities and Exchange Commission (“SEC”) did not, or are not expected to have a material effect on Monro’s consolidated financial statements.

Cash and cash equivalents

Cash and cash equivalents

Cash consists primarily of cash on hand and deposits with banks. Cash equivalents include highly liquid investments with an original maturity of three months or less from the time of purchase. Cash equivalents also include amounts due from third-party financial institutions for credit and debit card transactions. These receivables typically settle in three days or less.

Inventories

Inventories

Our inventories, which consist of automotive parts and oil as well as tires, are valued at the lower of weighted average cost or net realizable value.

Property and equipment, net

Property and equipment, net

Property and equipment, net is stated at historical cost less accumulated depreciation. Property and equipment is depreciated using the straight-line method over estimated useful lives. Leasehold improvements are depreciated over the shorter of their estimated useful lives or the related lease terms. When assets are disposed of, the resulting gain or loss is recognized in other income, net of other loss on the Consolidated Statement of Income and Comprehensive Income. Expenditures for maintenance and repairs are expensed as incurred.

Estimated Useful Lives	Life (Years)
Buildings and improvements	10 - 39
Equipment, signage and fixtures	3 - 15
Vehicles	5 - 10

Valuation of long-lived assets

Valuation of long-lived assets

We assess potential impairments to our long-lived assets, which include property and equipment and operating right-of-use (“ROU”) assets, whenever events or circumstances indicate that the carrying value of an asset may not be recoverable. Long-lived assets are grouped and evaluated for impairment at the lowest level for which there are identifiable cash flows that are independent of the cash flows of other groups of assets. If it is determined that the carrying amounts of such long-lived assets are not recoverable, the assets are written down to their estimated fair values. Fair value of the assets is determined based on the highest and best use of the asset group, considering external market participant assumptions. Since the determination of future cash flows is an estimate of future performance, there may be future impairments in the event that future cash flows do not meet expectations.

During 2020, we evaluated certain stores having indicators of impairment based on operating performance and taking into consideration the negative impact of the novel coronavirus strain (“COVID-19”) pandemic on forecasted store performance. Based on the estimate of future recoverable cash flows, we recorded an impairment charge totaling $6.6 million of which $4.3 million was related to 36 stores that closed in 2021. As part of the impairment charge, we wrote off $4.4 million of operating lease ROU assets, $0.6 million of finance lease ROU assets and $1.6 million of leasehold improvements and equipment.

No material impairment charges were recorded during 2021 or 2019.

Leases

Leases

We determine if an arrangement is or contains a lease at inception. We record ROU assets and lease obligations for our finance and operating leases, which are initially based on the discounted future minimum lease payments over the term of the lease. As the rate implicit in our leases is not easily determinable, our applicable incremental borrowing rate is used in calculating the present value of the lease payments. We estimate our incremental borrowing rate considering the market rates of our outstanding borrowings and comparisons to comparable borrowings of similar terms.

Lease term is defined as the non-cancelable period of the lease plus any option to extend the lease when it is reasonably certain that it will be exercised. For leases with an initial term of 12 months or less, no ROU assets or lease obligations are recorded on the balance sheet and we recognize short-term lease expense for these leases on a straight-line basis over the lease term.

Certain of our lease agreements include rental payments based on a percentage of retail sales over specified levels and others include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. For the majority of all classes of underlying assets, we have elected to separate lease from non-lease components. We have elected to combine lease and non-lease components for certain classes of equipment. We generally sublease excess space to third parties.

Operating lease expense is recognized on a straight-line basis over the lease term and is included in cost of sales, including distribution and occupancy costs (“cost of sales”) or operating, selling, general and administrative (“OSG&A”) expense. Amortization expense for

finance leases is recognized on a straight-line basis over the lease term and is included in cost of sales or OSG&A expense. Interest expense for finance leases is recognized using the effective interest method, and is included in interest expense, net of interest income. Variable payments, short-term rentals and payments associated with non-lease components are expensed as incurred.

Effective March 31, 2019, we adopted using the modified retrospective approach an accounting standards update with new guidance related to leases. The adoption of this guidance resulted in a $165.3 million increase to total assets, a $165.9 million increase to total liabilities and a $0.6 million decrease in shareholder’s equity as of March 31, 2019. Periods prior to fiscal 2020 have not been restated for the adoption of this standard update.

Goodwill and intangible assets

Goodwill and intangible assets

We have a history of growth through acquisitions. Assets and liabilities of acquired businesses are recorded at their estimated fair values as of the date of acquisition. Goodwill represents costs in excess of fair values assigned to the underlying net assets of acquired businesses. The carrying value of goodwill is subject to an annual impairment test, which we perform in the third quarter of the fiscal year. Impairment tests may also be triggered by any significant events or changes in circumstances affecting our business.

We have one reporting unit which encompasses all operations including new acquisitions. In performing our annual goodwill impairment test, we perform a qualitative assessment to determine if it is more likely than not that the fair value is less than the carrying value of goodwill. The qualitative assessment includes a review of business changes, economic outlook, financial trends and forecasts, growth rates, industry data, market capitalization and other relevant qualitative factors. If the qualitative factors indicate a potential impairment, we compare the fair value of our reporting unit to the carrying value of our reporting unit. If the fair value is less than its carrying value, an impairment charge is recognized in an amount equal to that excess. The loss recognized cannot exceed the carrying amount of goodwill. As a result of our annual qualitative assessment performed in the third quarter of 2021, we determined that it is not more likely than not that the fair value is less than the carrying value.

Subsequent to our prior year assessment performed in the third quarter of 2020, and due to developments associated with the COVID-19 pandemic, we considered our business performance expectations, as well as our share price as of 2020 year end in relation to the share price when the annual qualitative assessment was performed in the third quarter of 2020. Based on our analysis, we concluded that the events and circumstances related to the COVID-19 pandemic did not indicate an impairment of goodwill was more likely than not as of March 28, 2020.

Our intangible assets primarily represent allocations of purchase price to identifiable intangible assets of acquired businesses and are amortized over their estimated useful lives. All intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that an impairment may exist. If such indicators are present, it is determined whether the sum of the estimated undiscounted future cash flows attributable to such assets is less than their carrying values. Based on our review as of March 27, 2021, we concluded that the carrying values of our intangible assets were not impaired. No impairment was recorded in 2021, 2020 or 2019.

A deterioration of macroeconomic conditions may not only negatively impact the estimated operating cash flows used in our cash flow models, but may also negatively impact other assumptions used in our analyses, including, but not limited to, the estimated cost of capital and/or discount rates. Additionally, we are required to ensure that assumptions used to determine fair value in our analyses are consistent with the assumptions a hypothetical marketplace participant would use. As a result, the cost of capital and/or discount rates used in our analyses may increase or decrease based on market conditions and trends, regardless of whether our actual cost of capital has changed. Therefore, we may recognize an impairment of an intangible asset or assets even though realized actual cash flows are approximately equal to or greater than our previously forecasted amounts.

Self-insurance reserves

Self-insurance reserves

We are largely self-insured with respect to workers’ compensation, general liability and employee medical claims. In order to reduce our risk and better manage our overall loss exposure, we purchase stop-loss insurance that covers individual claims in excess of the deductible amounts, and caps total losses in a fiscal year. We maintain an accrual for the estimated cost to settle open claims as well as an estimate of the cost of claims that have been incurred but not reported. These estimates take into consideration the historical average claim volume, the average cost for settled claims, current trends in claim costs, changes in our business and workforce, and general economic factors. These accruals are reviewed on a quarterly basis, or more frequently if factors dictate a more frequent review is warranted. For more complex reserve calculations, such as workers’ compensation, we periodically use the services of an actuary to assist in determining the required reserve for open claims.

Warranty

Warranty

We provide an accrual for estimated future warranty costs for parts that we install based upon the historical relationship of warranty costs to sales. Warranty expense related to all product warranties for the fiscal years ended March 2021, 2020 and 2019 was not material to our financial position or results of operations. See Note 8 for additional information on tire road hazard warranty agreements.

Comprehensive income

Comprehensive income

As it relates to Monro, comprehensive income is defined as net income as adjusted for pension liability adjustments and is reported net of related taxes in the Consolidated Statements of Income and Comprehensive Income and in the Consolidated Statements of Changes in Shareholders’ Equity.

Income taxes

Income taxes

We account for income taxes pursuant to the asset and liability method which requires the recognition of deferred tax assets and liabilities related to the expected future tax consequences arising from temporary differences between the carrying amounts and tax bases of assets and liabilities based on enacted statutory tax rates applicable to the periods in which the temporary differences are expected to reverse. Any effects of changes in income tax rates or laws are included in income tax expense in the period of enactment. A valuation allowance is recognized if we determine it is more likely than not that all or a portion of a deferred tax asset will not be recognized. In making such determination, the Company considers all available evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent and expected future results of operation. Monro recognizes a tax benefit from an uncertain tax position in the financial statements only when it is more likely than not that the position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits and a consideration of the relevant taxing authority's administrative practices and precedents.

On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) to provide certain relief as a result of the COVID-19 pandemic. The CARES Act provides tax relief, along with other stimulus measures, including an employer deferral of the deposit of the employer’s share of social security taxes during the period beginning March 27, 2020 and ending December 31, 2020. We deferred the employer paid portion of social security taxes as permitted by the CARES Act during fiscal 2021 and may continue to defer payment prior to the applicable date the deposits must be paid.

Treasury stock

Treasury stock

Treasury stock is accounted for using the par value method.

Stock-based compensation

Share-based compensation

We provide share-based compensation through non-qualified stock options, restricted stock awards and restricted stock units. We measure compensation cost arising from the grant of share-based payments to an employee at fair value, and recognize such cost in income over the period during which the employee is required to provide service in exchange for the award, usually the vesting period. The fair value of each option award is estimated on the date of grant primarily using the Black-Scholes option valuation model. The assumptions used to estimate fair value require judgment and are subject to change in the future due to factors such as employee exercise behavior, stock price trends, and changes to type or provisions of share-based awards. Any material change in one or more of these assumptions could have an impact on the estimated fair value of a future award.

Black-Scholes Valuation Model Assumptions
(weighted-average)	2021		2020		2019
Risk-free interest rate (a)	0.27	%	1.85	%	2.81	%
Expected term (years) (b)	4		4		4
Expected volatility (c)	33.3	%	30.4	%	28.3	%
Dividend yield (d)	1.60	%	1.12	%	1.24	%

(a) Risk-free interest rates are yields for zero coupon U.S. Treasury notes maturing approximately at the end of the expected option term.

(b)Expected term is based on historical exercise behavior and on the terms and conditions of the stock option award.

(c)Expected volatility is based on a combination of historical volatility, using Monro stock prices over a period equal to the expected term, and implied market volatility.

(d)Dividend yield is based on historical dividend experience and expected future changes, if any.

The fair value of restricted stock awards and restricted stock units (collectively “restricted stock”) is determined based on the stock price at the date of grant.

We are required to estimate forfeitures and only record compensation costs for those awards that are expected to vest. The assumptions for forfeitures were determined based on type of award and historical experience. Forfeiture assumptions are adjusted at the point in time a significant change is identified, with any adjustment recorded in the period of change, and the final adjustment at the end of the requisite service period to equal actual forfeitures.

We recognize compensation expense related to stock options and restricted stock using the straight-line approach. Option awards and restricted stock generally vest equally over the service period established in the award, typically three years or four years. In 2020 and 2019, the Company issued a limited number of restricted stock units to members of senior management which may vest upon the achievement of a three year average return on invested capital target.

Earnings per common share

Earnings per common share

Basic earnings per common share amounts are calculated by dividing income available to common shareholders, after deducting preferred stock dividends, by the weighted average number of shares of common stock outstanding. Diluted earnings per common share amounts are calculated by dividing net income by the weighted average number of shares of common stock and common stock equivalents outstanding. Common stock equivalents represent shares issuable upon the assumed exercise of common stock options outstanding.

Advertising

Advertising

The cost of advertising is generally expensed at the first time the advertising takes place, except for direct response advertising which is capitalized and amortized over its expected period of future benefit.

Direct response advertising consists primarily of coupons for Monro’s services. The capitalized costs of this advertising are amortized over the period of the coupon’s validity, which is typically two months.

Prepaid advertising at March 27, 2021 and March 28, 2020, and advertising expense for 2021, 2020 and 2019, were not material to these financial statements.

Vendor rebates

Vendor rebates

We receive vendor support in the form of allowances through a variety of vendor-sponsored programs, such as volume rebates, promotions, and advertising allowances, referred to as “vendor rebates”. Vendor rebates are recorded as a reduction of cost of sales.

We establish a receivable for vendor rebates that are earned but not yet received. Based on purchase data and the terms of the applicable vendor-sponsored programs, we estimate the amount earned. The majority of the year-end vendor rebates receivable is collected within the following first quarter. See Note 4 for additional information.

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Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies (Tables)

12 Months Ended

Mar. 27, 2021

Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract]

Schedule of Estimated Useful Lives

Estimated Useful Lives	Life (Years)
Buildings and improvements	10 - 39
Equipment, signage and fixtures	3 - 15
Vehicles	5 - 10

Schedule of Share-Based Compensation Valuation Assumptions

Black-Scholes Valuation Model Assumptions
(weighted-average)	2021		2020		2019
Risk-free interest rate (a)	0.27	%	1.85	%	2.81	%
Expected term (years) (b)	4		4		4
Expected volatility (c)	33.3	%	30.4	%	28.3	%
Dividend yield (d)	1.60	%	1.12	%	1.24	%

(a) Risk-free interest rates are yields for zero coupon U.S. Treasury notes maturing approximately at the end of the expected option term.

(b)Expected term is based on historical exercise behavior and on the terms and conditions of the stock option award.

(c)Expected volatility is based on a combination of historical volatility, using Monro stock prices over a period equal to the expected term, and implied market volatility.

(d)Dividend yield is based on historical dividend experience and expected future changes, if any.

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Acquisitions (Tables)

12 Months Ended

Mar. 27, 2021

Fiscal 2020 Acquisitions [Member]

Business Acquisition [Line Items]

Schedule Of Purchase Price Allocation

2020 Acquisition-date Fair Values Assigned
(thousands)
Inventories	$	4,433
Other current assets		706
Property and equipment		2,405
Finance lease and financing obligation assets, net		29,147
Operating lease assets, net		42,680
Intangible assets		2,847
Other non-current assets		374
Long-term deferred income tax assets		4,870
Total assets acquired		87,462
Current portion of finance leases and financing obligations		2,672
Current portion of operating lease liabilities		4,416
Deferred revenue		1,618
Other current liabilities		358
Long-term finance leases and financing obligations		36,225
Long-term operating lease liabilities		43,668
Other long-term liabilities		1,747
Total liabilities assumed		90,704
Total net identifiable liabilities assumed	$	(3,242)
Total consideration transferred	$	103,692
Less: total net identifiable liabilities assumed		(3,242)
Goodwill	$	106,934

Fiscal 2021 Acquisitions [Member]

Business Acquisition [Line Items]

Schedule Of Purchase Price Allocation

2021 Acquisition-date Fair Values Assigned
(thousands)
Inventory	$	1,046
Other current assets		172
Property and equipment		674
Finance lease and financing obligation assets, net		5,089
Operating lease assets, net		8,980
Intangible asset		418
Other non-current assets		30
Long-term deferred income tax assets		1,331
Total assets acquired		17,740
Current portion of finance leases and financing obligations		748
Current portion of operating lease liabilities		976
Deferred revenue		697
Other current liabilities		4
Long-term finance leases and financing obligations		7,911
Long-term operating lease liabilities		7,433
Other long-term liabilities		536
Total liabilities assumed		18,305
Total net identifiable liabilities assumed	$	(565)
Total consideration transferred	$	17,112
Less: total net identifiable liabilities assumed		(565)
Goodwill	$	17,677

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Other Current Assets (Tables)

12 Months Ended

Mar. 27, 2021

Other Current Assets [Abstract]

Composition of other current assets

Other Current Assets
(thousands)		March 27, 2021		March 28, 2020
Vendor rebates receivable	$	15,068	$	16,232
Other		33,047		24,305
Total	$	48,115	$	40,537

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Property and Equipment (Tables)

12 Months Ended

Mar. 27, 2021

Property and Equipment [Abstract]

Major Classifications Of Property, Plant And Equipment

Property and Equipment
(thousands)		March 27, 2021		March 28, 2020
Land	$	84,485	$	84,765
Buildings and improvements		289,328		272,724
Equipment, signage and fixtures		291,179		278,324
Vehicles		37,684		38,356
Construction-in-progress		7,073		8,763
Property and equipment		709,749		682,932
Less - Accumulated depreciation		382,686		354,295
Property and equipment, net	$	327,063	$	328,637

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Goodwill and Intangible Assets (Tables)

12 Months Ended

Mar. 27, 2021

Goodwill and Intangible Assets [Abstract]

Changes in goodwill

Reconciliation of Changes in Goodwill
(thousands)		2021		2020
Balance at beginning of period	$	671,843	$	565,503
Current fiscal year acquisitions		17,677		106,930
Adjustments to prior fiscal year acquisitions		4		(590)
Balance at end of period	$	689,524	$	671,843

Composition of other intangible assets

Intangible Assets	March 27, 2021				March 28, 2020
		Gross		Accumulated		Gross		Accumulated
(thousands)		Carrying Amount		Amortization		Carrying Amount		Amortization
Customer lists	$	36,000	$	21,932	$	42,511	$	26,333
Trade names		18,452		10,321		21,252		12,072
Franchise agreements		7,100		3,231		7,220		2,805
Other intangible assets		50		50		590		582
Total	$	61,602	$	35,534	$	71,573	$	41,792

Estimated Weighted Average Useful Lives	Life (Years)
Customer lists	10
Trade names	15
Franchise agreements	13
Other intangible assets	20

Estimated future amortization of intangible assets

Estimated Future Amortization Expense
(thousands)		Amortization
2022	$	3,838
2023		3,583
2024		3,223
2025		2,866
2026		2,646

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Revenue (Tables)

12 Months Ended

Mar. 27, 2021

Revenue [Abstract]

Schedule Of Disaggregated Revenue By Product Group

Revenues
(thousands)		2021		2020		2019
Brakes	$	130,179	$	169,138	$	162,709
Exhaust		20,201		25,058		28,713
Steering		85,290		100,230		95,711
Tires (a)		617,815		634,513		601,295
Maintenance		269,337		324,494		308,668
Other		2,899		3,091		3,134
Total	$	1,125,721	$	1,256,524	$	1,200,230

(a) Includes the sale of tire road hazard warranty agreements and tire delivery commissions.

Schedule Of Changes In Deferred Revenue

Changes in Deferred Revenue
(thousands)		2021		2020
Balance at beginning of period	$	18,506	$	17,150
Deferral of revenue		14,958		17,466
Deferral of revenue from acquisitions		1,225		2,916
Recognition of revenue		(17,977)		(19,026)
Balance at end of period	$	16,712	$	18,506

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Income Taxes (Tables)

12 Months Ended

Mar. 27, 2021

Income Taxes [Abstract]

Components of the provision for income taxes

Provision for Income Taxes
(thousands)		2021		2020		2019
Current:
Federal	$	(1,809)	$	2,783	$	5,682
State		827		1,994		2,409
Total current		(982)		4,777		8,091
Deferred:
Federal		10,169		11,397		11,563
State		685		76		954
Total deferred		10,854		11,473		12,517
Total provision	$	9,872	$	16,250	$	20,608

Reconciliation between Federal statutory tax rate and effective tax rate reflected in accompanying financial statements

Income Tax Rate Reconciliation	2021		2020		2019
Expected U.S. federal income taxes at statutory rate	21.0	%	21.0	%	21.0	%
State income taxes, net of federal tax benefit	2.9		1.9		2.8
Tax settlements and adjustments (a)	(1.1)		—		(1.9)
Other	(0.5)		(1.0)		(1.4)
Effective tax rate	22.3	%	21.9	%	20.5	%

(a)For 2021, adjustments reflect benefit due to differences in statutory tax rates from loss years to years in which net operating losses may be carried back. For 2019, settlements reflect benefit from Internal Revenue Service’s examination of our 2016 and 2017 tax returns.

Deferred tax (liabilities) assets

Net Deferred Tax Asset/(Liability)
(thousands)		March 27, 2021		March 28, 2020
Gross deferred tax assets:
Lease liabilities	$	186,168	$	169,366
Insurance reserves		11,441		10,192
Other		15,282		14,765
Total gross deferred tax assets		212,891		194,323
Gross deferred tax liabilities:
Leased assets		(148,496)		(131,484)
Goodwill		(56,623)		(47,204)
Property and equipment		(21,032)		(18,232)
Other		(910)		(1,288)
Total deferred tax liabilities		(227,061)		(198,208)
Total net deferred tax liability	$	(14,170)	$	(3,885)

Income taxes associated with unrecognized tax benefits

Changes in Liability for Unrecognized Tax Benefits
(thousands)		2021		2020		2019
Balance at beginning of period	$	5,212	$	6,424	$	6,209
Additions based on tax positions related to the current year		915		644		1,178
Additions for tax positions of prior years		—		—		166
Reductions for tax positions of prior years		—		(30)		(6)
Settlements		—		—		—
Lapse in statutes of limitation		(1,092)		(1,826)		(1,123)
Balance at end of period	$	5,035	$	5,212	$	6,424

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Share Based Compensation (Tables)

12 Months Ended

Mar. 27, 2021

Share Based Compensation [Abstract]

Summary of Changes in Outstanding Stock Options

Stock Option Activity				Weighted-average
				Remaining
	Stock		Weighted-average	Contractual		Aggregate Intrinsic
	Options		Exercise Price	Term (years)		Value (a)
Outstanding as of March 28, 2020	802,766	$	58.55
Granted	166,193		55.29
Exercised	(130,998)		47.93
Canceled	(324,094)		56.14
Outstanding as of March 27, 2021	513,867	$	61.75	3.12	$	3,483,001
Vested and exercisable as of March 27, 2021	286,549	$	61.30	1.93	$	1,805,603

(a)Total shares valued at the market price of the underlying stock as of March 27, 2021 less the exercise price.

Share-based Compensation Stock Option Excercises

Stock Option Exercises
(millions)		2021		2020		2019
Total intrinsic value of stock options exercised	$	1.5	$	2.9	$	7.4
Cash received for exercise price		6.3		6.2		14.6
Income tax benefit		—		0.4		1.0

Summary Of Stock Options Outstanding

Stock Options Outstanding	Options Outstanding				Options Exercisable
and Exercisable		Weighted-				Weighted-
		average		Weighted-		average		Weighted-
	Shares	Remaining		average	Shares	Remaining		average
	Outstanding	Contractual		Exercise	Exercisable	Contractual		Exercise
Range of Exercise Prices	at 3/27/2021	Term (years)		Price	at 3/27/2021	Term (years)		Price
$40.71 - $55.15	129,817	3.77	$	50.86	53,993	2.35	$	47.88
$55.16 - $57.78	131,696	2.93		56.97	66,393	0.86	$	57.28
$57.79 - $66.90	134,126	2.36		64.38	113,151	2.03	$	64.37
$66.91 - $87.17	118,228	3.49		76.04	53,012	2.62	$	73.44

Summary Of Restricted Stock

Non-vested Restricted Stock Activity			Weighted-average
	Restricted Stock		Grant-date
	Shares		Fair Value per Share
Outstanding as of March 28, 2020	55,730	$	64.96
Granted	35,019		52.75
Vested	(26,333)		56.52
Forfeited	(12,703)		63.90
Outstanding as of March 27, 2021	51,713	$	61.24

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Earnings Per Common Share (Tables)

12 Months Ended

Mar. 27, 2021

Earnings Per Common Share [Abstract]

Reconciliation Of Basic And Diluted Earnings Per Share

Earnings per Common Share
(thousands, except per share data)		2021		2020		2019
Numerator for earnings per common share calculation:
Net income	$	34,319	$	58,024	$	79,752
Less: Preferred stock dividends		(438)		(449)		(408)
Income available to common stockholders	$	33,881	$	57,575	$	79,344
Denominator for earnings per common share calculation:
Weighted average common shares - basic		33,329		33,246		32,980
Effect of dilutive securities:
Preferred stock		503		510		510
Stock options		26		167		154
Restricted stock		18		30		31
Weighted average common shares - diluted		33,876		33,953		33,675
Basic earnings per common share	$	1.02	$	1.73	$	2.41
Diluted earnings per common share	$	1.01	$	1.71	$	2.37

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Leases (Tables)

12 Months Ended

Mar. 27, 2021

Leases [Abstract]

Schedule Of Operating And Finance Lease Costs

Lease Cost
(thousands)		2021		2020
Operating lease cost	$	35,998	$	38,525
Finance lease/financing obligations cost:
Amortization of leased assets		30,428		21,033
Interest on lease liabilities		18,344		21,330
Short term and variable lease cost		321		2,194
Sublease income		(95)		(166)
Total lease cost	$	84,996	$	82,916

Schedule Of Future Maturities of Lease Liabilities

Maturity of Lease Liabilities				Finance Leases and
(thousands)		Operating Leases (a)		Financing Obligations (b)
2022	$	36,451	$	55,389
2023		34,381		55,487
2024		31,685		54,405
2025		28,414		51,494
2026		25,161		48,992
Thereafter		83,454		250,812
Total undiscounted lease obligations	$	239,546	$	516,579
Less: imputed interest		(30,919)		(112,446)
Present value of lease obligations	$	208,627	$	404,133

(a)Operating lease obligations include $61.0 million related to options to extend operating leases that are reasonably certain of being exercised.

(b)Finance lease payments include $108.4 million related to options to extend finance leases that are reasonably certain of being exercised.

Schedule Of Weighted Average Remaining Lease Terms And Discount Rates

Lease Term and Discount Rate	2021		2020
Weighted average remaining lease term (years)
Operating leases	8.6		9.4
Finance leases and financing obligations	10.3		9.9
Weighted average discount rate
Operating leases	2.96	%	3.51	%
Finance leases and financing obligations	6.20	%	8.73	%

Schedule Of Supplemental Cash Flow Information Related To Leases

Other Information
(thousands)		2021		2020
Cash paid for amounts included in measurement of lease obligations:
Operating cash flows from operating leases	$	34,931	$	36,808
Operating cash flows from finance leases and financing obligations		18,602		21,340
Financing cash flows from finance leases and financing obligations		33,032		27,212

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Defined Benefit and Defined Contribution Plans (Tables)

12 Months Ended

Mar. 27, 2021

Pension benefit payments

Estimated Future Benefit Payments
(thousands)		Pension Benefits
2022	$	1,065
2023		1,098
2024		1,114
2025		1,147
2026		1,188
2027 - 2031		6,322

Components of pension income

Net Pension Benefits Expense (Income)
(thousands)		2021		2020		2019
Interest cost on projected benefit obligation	$	692	$	752	$	781
Expected return on plan assets		(1,162)		(1,423)		(1,409)
Amortization of unrecognized actuarial loss		892		455		403
Total	$	422	$	(216)	$	(225)

Weighted average assumptions used to determine benefit obligations

Benefit Obligation Weighted Average Assumption	2021		2020
Discount rate	3.01	%	3.34	%

Weighted average assumptions used to determine net periodic pension costs

Net Periodic Benefit Expense Weighted Average Assumptions	2021		2020		2019
Discount rate	3.34	%	3.72	%	3.89	%
Expected long-term rate of return on plan assets	6.50	%	7.00	%	7.00	%

Funded status of plan

Benefit Obligation

Change in Projected Benefit Obligation
(thousands)		2021		2020
Benefit obligation at beginning of year	$	21,646	$	20,972
Interest cost		692		752
Actuarial loss		391		642
Benefits paid		(633)		(720)
Benefit obligation at end of year (a)	$	22,096	$	21,646

(a) Accumulated benefit obligation-the present value of benefits earned to date assuming no future salary growth-is materially consistent with the projected benefit obligation in each period presented.

Plan Assets

Change in Plan Assets
(thousands)		2021		2020
Fair value of plan assets at beginning of year	$	18,611	$	20,838
Actual return (loss) on plan assets		3,688		(1,507)
Benefits paid		(633)		(720)
Fair value of plan assets at end of year	$	21,666	$	18,611

Company's asset allocations by asset category

Asset Category	Current Targeted		Actual Allocation
	Allocation		2021		2020
Cash and cash equivalents			53.3	%	4.1	%
Fixed income	50.0	%	24.7	%	37.9	%
Equity securities	50.0	%	22.0	%	58.0	%
Total	100.0	%	100.0	%	100.0	%

Fair value measurement information for the Company's major categories of defined benefit plan assets

Fair Value Measurements		Fair Value at
(thousands)	Pricing Category (a)		March 27, 2021		March 28, 2020
Cash equivalents	Level 1	$	11,542	$	761
Equity securities:
U.S. companies	Level 1		3,372		7,383
U.S. companies	Level 2		—		283
International companies	Level 1		1,391		3,137
Fixed income:
U.S. corporate bonds	Level 2		5,361		6,686
International bonds	Level 2		—		361
Total plan assets		$	21,666	$	18,611

(a) Fair value measurements are reported in one of three levels based on the lowest level of significant input used: Level 1 (unadjusted quoted prices in active markets); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data).

Amounts recognized in accumulated other comprehensive loss

Amounts in Accumulated Other Comprehensive Loss
(thousands)		2021		2020
Unamortized net actuarial loss	$	6,147	$	9,174
Amounts in Accumulated Other Comprehensive Loss (a)	$	6,147	$	9,174

(a) $4,619 and $6,889, net of tax, at the end of 2021 and 2020, respectively.

Changes in plan assets and benefit obligations recognized in other comprehensive (loss) income

Amounts in Other Comprehensive Income (Loss)
(thousands)		2021		2020		2019
Net actuarial income (loss)	$	3,027	$	(3,117)	$	(382)
Amounts in Other Comprehensive Income (Loss) (a)	$	3,027	$	(3,117)	$	(382)

(a) $2,270, ($2,353) and ($288), net of tax, during 2021, 2020 and 2019, respectively.

Defined Benefit Plan, Underfunded Plan [Member]

Funded status of plan

Underfunded Status
(thousands)		2021		2020
Projected benefit obligations	$	22,096	$	21,646
Fair value of plan assets		21,666		18,611
Underfunded status	$	(430)	$	(3,035)

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Commitments and Contingencies (Tables)

12 Months Ended

Mar. 27, 2021

Commitments and Contingencies [Abstract]

Schedule Of Payments Due By Period

Commitments Due by Period				Within		2 to		4 to		After
(thousands)		Total		1 Year		3 Years		5 Years		5 Years
Principal payments on long-term debt	$	190,000					$	190,000
Finance lease commitments/financing obligations (a)		516,579	$	55,389	$	109,892		100,486	$	250,812
Operating lease commitments (a)		239,546		36,451		66,066		53,575		83,454
Accrued rent		1,807		1,563		132		42		70
Other liabilities		1,133		800		333		—		—
Total	$	949,065	$	94,203	$	176,423	$	344,103	$	334,336

(a) Finance and operating lease commitments represent future undiscounted lease payments and include $108.4 million and $61.0 million, respectively, related to options to extend lease terms that are reasonably certain of being exercised.

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Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies (Narrative) (Details)		12 Months Ended
	Mar. 31, 2019 USD ($)	Mar. 27, 2021 USD ($) segment property state store item	Mar. 28, 2020 USD ($)	Mar. 30, 2019 USD ($)
Significant Accounting Policies [Line Items]
Company operated stores | store		1,263
Franchised locations | property		96
Number of wholesale locations | property		7
Number of retread facilities | property		3
Number of States in which Entity Operates | state		32
Number of operating segments | segment		1
Total assets		$ 1,811,814,000	$ 2,049,457,000
Total liabilities		$ 1,062,130,000	1,315,017,000
Number of store closures | store		36
Impairment of long-lived assets		$ 144,000	6,579,000	$ 0
Number of reporting units | item		1
Impairment of intangible assets		$ 0	0	$ 0
Advertising expenses amortization period		2 months
Operating Lease ROU Assets [Member]
Significant Accounting Policies [Line Items]
Impairment of long-lived assets		$ 4,400,000
Accounting Standards Update 2016-02 [Member]
Significant Accounting Policies [Line Items]
Total assets	$ 165,300,000
Total liabilities	165,900,000
Decrease in shareholder’s equity	$ (600,000)
COVID-19 Pandemic [Member]
Significant Accounting Policies [Line Items]
Impairment of long-lived assets			$ 6,600,000
Impairment of long-lived assets, related to store closures		4,300,000
COVID-19 Pandemic [Member] | Finance Lease ROU Assets [Member]
Significant Accounting Policies [Line Items]
Impairment of long-lived assets		600,000
COVID-19 Pandemic [Member] | Leasehold Improvements And Equipment [Member]
Significant Accounting Policies [Line Items]
Impairment of long-lived assets		$ 1,600,000
Stock Options [Member]
Significant Accounting Policies [Line Items]
Options award vesting period		4 years
Senior Management [Member] | Restricted Stock [Member]
Significant Accounting Policies [Line Items]
Options award vesting period		3 years	3 years	3 years
Maximum [Member] | Stock Options [Member]
Significant Accounting Policies [Line Items]
Options award vesting period		4 years
Maximum [Member] | Restricted Stock [Member]
Significant Accounting Policies [Line Items]
Options award vesting period		4 years
Minimum [Member] | Stock Options [Member]
Significant Accounting Policies [Line Items]
Options award vesting period		3 years
Minimum [Member] | Restricted Stock [Member]
Significant Accounting Policies [Line Items]
Options award vesting period		3 years

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Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies (Schedule Of Estimated Useful Lives) (Details)	12 Months Ended
	Mar. 27, 2021
Buildings and Improvements [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful lives	10 years
Buildings and Improvements [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful lives	39 years
Equipment, Signage And Fixtures [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful lives	3 years
Equipment, Signage And Fixtures [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful lives	15 years
Vehicles [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful lives	5 years
Vehicles [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful lives	10 years

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Description Of Business, Basis Of Presentation And Summary Of Significant Accounting Policies (Schedule of Share-Based Compensation Valuation Assumptions) (Details)		12 Months Ended
		Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Weighted average fair value of options granted
Risk-free interest rate	[1]	0.27%	1.85%	2.81%
Expected term (years)	[2]	4 years	4 years	4 years
Expected volatility	[3]	33.30%	30.40%	28.30%
Dividend yield	[4]	1.60%	1.12%	1.24%

[1] Risk-free interest rates are yields for zero coupon U.S. Treasury notes maturing approximately at the end of the expected option term.

[2] Expected term is based on historical exercise behavior and on the terms and conditions of the stock option award.

[3] Expected volatility is based on a combination of historical volatility, using Monro stock prices over a period equal to the expected term, and implied market volatility.

[4] Dividend yield is based on historical dividend experience and expected future changes, if any.

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Impact Of The COVID-19 Pandemic (Narrative) (Details) - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Mar. 31, 2020	Mar. 27, 2021
Impact Of The COVID-19 Pandemic [Abstract]
Revolving credit facility borrowed	$ 350
Repayment of revolving credit facility		$ 350

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Acquisitions (Narrative) (Details) $ in Thousands			12 Months Ended
	Apr. 25, 2021 store	Dec. 06, 2020 USD ($) store	Mar. 27, 2021 USD ($) property	Mar. 28, 2020 USD ($) store property
Business Acquisition [Line Items]
Store acquisitions related to acquisition growth strategy | property			5
Total consideration transferred | $				$ 103,700
Costs related to completed acquisitions | $			$ 300	1,400
Sales for acquired entities | $			5,800	59,300
Net income (loss) for acquired entities | $			$ 100	$ (3,900)
Maximum [Member]
Business Acquisition [Line Items]
Store acquisitions related to greenfield store growth strategy | property			4
Minimum [Member]
Business Acquisition [Line Items]
Store acquisitions related to greenfield store growth strategy | property			1
Fred Allen Enterprises, Inc. [Member]
Business Acquisition [Line Items]
Total consideration transferred | $		$ 17,100
Number of stores acquired		17
Nevada Tire Holdings, LLC and Idaho Tire Holdings, LLC [Member]
Business Acquisition [Line Items]
Acquisition date			Nov. 17, 2019
Number of stores acquired				18
S & S Unlimited, Inc. [Member]
Business Acquisition [Line Items]
Acquisition date			Oct. 27, 2019
Number of stores acquired				6
Lloyd’s Tire Service, Inc. [Member]
Business Acquisition [Line Items]
Acquisition date			Oct. 27, 2019
Number of stores acquired				3
Atlas Tire Center, Inc. [Member]
Business Acquisition [Line Items]
Acquisition date			Aug. 25, 2019
Number of stores acquired				1
LRZ3 Auto, LLC. [Member]
Business Acquisition [Line Items]
Acquisition date			Aug. 25, 2019
Number of stores acquired				2
T-Boy's Tire and Automotive, LLC. [Member]
Business Acquisition [Line Items]
Acquisition date			Aug. 25, 2019
Number of stores acquired				1
Twin Tire & Auto Care, Inc. [Member]
Business Acquisition [Line Items]
Acquisition date			Aug. 25, 2019
Number of stores acquired				2
Twin Tire & Auto Care Team, Inc. [Member]
Business Acquisition [Line Items]
Acquisition date			Aug. 25, 2019
Number of stores acquired				1
Scotty's Tire & Automotive, Inc. [Member]
Business Acquisition [Line Items]
Acquisition date			Aug. 25, 2019
Number of stores acquired				1
BAW LLC [Member]
Business Acquisition [Line Items]
Acquisition date			Jun. 23, 2019
Number of stores acquired				2
Certified Tire And Service Centers, Inc. [Member]
Business Acquisition [Line Items]
Acquisition date			May 19, 2019
Number of stores acquired				40
Number of distribution centers acquired | property				1
Allied Discount Tire And Brake, Inc [Member]
Business Acquisition [Line Items]
Acquisition date			Mar. 31, 2019
Number of stores acquired				12
Mountain View Tire And Service [Member] | Subsequent Event [Member]
Business Acquisition [Line Items]
Number of stores acquired	30
Fiscal 2020 Acquisitions [Member]
Business Acquisition [Line Items]
Total consideration transferred | $				$ 103,692
Fiscal 2020 Acquisitions [Member] | Customer Lists [Member]
Business Acquisition [Line Items]
Weighted average useful life			7 years
Intangible assets | $				$ 2,800
Fiscal 2021 Acquisitions [Member]
Business Acquisition [Line Items]
Total consideration transferred | $			$ 17,112
Total consideration transferred, portion in cash | $			16,300
Payable to a seller | $			$ 800
Fiscal 2021 Acquisitions [Member] | Customer Lists [Member]
Business Acquisition [Line Items]
Weighted average useful life			7 years
Intangible assets | $			$ 400

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Acquisitions (Schedule Of Purchase Price Allocation) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Purchase price of acquisitions allocation
Total consideration transferred		$ 103,700
Goodwill	$ 689,524	671,843	$ 565,503
Fiscal 2020 Acquisitions [Member]
Purchase price of acquisitions allocation
Inventories		4,433
Other current assets		706
Property and equipment		2,405
Finance lease and financing obligation assets, net		29,147
Operating lease assets, net		42,680
Intangible assets		2,847
Other non-current assets		374
Long-term deferred income tax assets		4,870
Total assets acquired		87,462
Current portion of finance leases and financing obligations		2,672
Current portion of operating lease liabilities		4,416
Deferred revenue		1,618
Other current liabilities		358
Long-term finance leases and financing obligations		36,225
Long-term operating lease liabilities		43,668
Other long-term liabilities		1,747
Total liabilities assumed		90,704
Total net identifiable liabilities assumed		(3,242)
Total consideration transferred		103,692
Less: total net identifiable liabilities assumed		(3,242)
Goodwill		$ 106,934
Fiscal 2021 Acquisitions [Member]
Purchase price of acquisitions allocation
Inventories	1,046
Other current assets	172
Property and equipment	674
Finance lease and financing obligation assets, net	5,089
Operating lease assets, net	8,980
Intangible assets	418
Other non-current assets	30
Long-term deferred income tax assets	1,331
Total assets acquired	17,740
Current portion of finance leases and financing obligations	748
Current portion of operating lease liabilities	976
Deferred revenue	697
Other current liabilities	4
Long-term finance leases and financing obligations	7,911
Long-term operating lease liabilities	7,433
Other long-term liabilities	536
Total liabilities assumed	18,305
Total net identifiable liabilities assumed	(565)
Total consideration transferred	17,112
Less: total net identifiable liabilities assumed	(565)
Goodwill	$ 17,677

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Other Current Assets (Details) - USD ($) $ in Thousands	Mar. 27, 2021	Mar. 28, 2020
Composition of other current assets
Vendor rebates receivable	$ 15,068	$ 16,232
Other	33,047	24,305
Total	$ 48,115	$ 40,537

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Property and Equipment (Narrative) (Details) - USD ($) $ in Millions	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Property and Equipment [Abstract]
Depreciation expense	$ 42.9	$ 39.2	$ 35.5

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Property and Equipment (Major Classifications Of Property, Plant And Equipment) (Details) - USD ($) $ in Thousands	Mar. 27, 2021	Mar. 28, 2020
Major classifications of property, plant and equipment
Property and equipment	$ 709,749	$ 682,932
Less - Accumulated depreciation and amortization	382,686	354,295
Property and equipment, net	327,063	328,637
Land [Member]
Major classifications of property, plant and equipment
Property and equipment	84,485	84,765
Buildings and Improvements [Member]
Major classifications of property, plant and equipment
Property and equipment	289,328	272,724
Equipment, Signage And Fixtures [Member]
Major classifications of property, plant and equipment
Property and equipment	291,179	278,324
Vehicles [Member]
Major classifications of property, plant and equipment
Property and equipment	37,684	38,356
Construction-in-Progress [Member]
Major classifications of property, plant and equipment
Property and equipment	$ 7,073	$ 8,763

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Goodwill and Intangible Assets (Narrative) (Details) - USD ($) $ in Millions	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Goodwill and Intangible Assets [Abstract]
Amortization of intangible assets	$ 4.1	$ 4.8	$ 5.3

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Goodwill and Intangible Assets (Changes In Goodwill) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020
Changes in goodwill
Balance at beginning of period	$ 671,843	$ 565,503
Current fiscal year acquisitions	17,677	106,930
Adjustments to prior fiscal year acquisitions	4	(590)
Balance at end of period	$ 689,524	$ 671,843

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Goodwill and Intangible Assets (Composition of other intangible assets) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020
Composition of other intangible assets
Gross carrying amount	$ 61,602	$ 71,573
Accumulated amortization	35,534	41,792
Customer Lists [Member]
Composition of other intangible assets
Gross carrying amount	36,000	42,511
Accumulated amortization	$ 21,932	26,333
Estimated weighted average useful lives, in years	10 years
Trade Names [Member]
Composition of other intangible assets
Gross carrying amount	$ 18,452	21,252
Accumulated amortization	$ 10,321	12,072
Estimated weighted average useful lives, in years	15 years
Franchise Agreements [Member]
Composition of other intangible assets
Gross carrying amount	$ 7,100	7,220
Accumulated amortization	$ 3,231	2,805
Estimated weighted average useful lives, in years	13 years
Other Intangible Assets [Member]
Composition of other intangible assets
Gross carrying amount	$ 50	590
Accumulated amortization	$ 50	$ 582
Estimated weighted average useful lives, in years	20 years

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Goodwill and Intangible Assets (Estimated future amortization of intangible assets) (Details) - Customer Lists, Trade Names, Franchise Agreements and Other Intangible Assets [Member] $ in Thousands	Mar. 27, 2021 USD ($)
Estimated future amortization of intangible assets
2022	$ 3,838
2023	3,583
2024	3,223
2025	2,866
2026	$ 2,646

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Long-Term Debt (Narrative) (Details)		12 Months Ended
	Jun. 11, 2020 USD ($)	Mar. 27, 2021 USD ($) entity	Mar. 28, 2020 USD ($)
Debt Instrument [Line Items]
Fair value of long-term debt (including current portion)		$ 190,000,000.0	$ 566,400,000
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Credit facility term		5 years
Revolving credit facility agreement		$ 600,000,000
Revolving credit facility agreement, number of participating banks | entity		8
Credit Facility Increased Availability		$ 250,000,000
Amount outstanding under Credit Facility		190,000,000.0
Net availability under the credit facility		$ 376,400,000
Revolving Credit Facility [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Interest rate at period end over LIBOR		2.25%	1.00%
First Amendment To Credit Facility [Member]
Debt Instrument [Line Items]
Allowable dividend or distribution	$ 38,500,000
Allowable acquisitions	$ 100,000,000
Standby Letters of Credit [Member]
Debt Instrument [Line Items]
Revolving credit facility agreement		$ 80,000,000
Amount outstanding under Credit Facility		$ 33,600,000
Minimum [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Percentage of fees on amount available		0.125%
Minimum [Member] | Revolving Credit Facility [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Interest rate over LIBOR on the facility		0.75%
Minimum [Member] | First Amendment To Credit Facility [Member]
Debt Instrument [Line Items]
Interest rate	0.75%
Minimum [Member] | First Amendment To Credit Facility [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Interest rate spread during debt covenant relief period	2.25%
Minimum [Member] | Standby Letters of Credit [Member]
Debt Instrument [Line Items]
Percentage of fees on amount available		0.875%
Maximum [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Percentage of fees on amount available		0.35%
Maximum [Member] | Revolving Credit Facility [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Interest rate over LIBOR on the facility		2.00%
Maximum [Member] | Standby Letters of Credit [Member]
Debt Instrument [Line Items]
Percentage of fees on amount available		2.125%

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Revenue (Narrative) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenue	$ 16,712	$ 18,506	$ 17,150
Deferred revenue, current	11,956	13,129
Deferred revenue, noncurrent	$ 4,700	$ 5,400
Minimum [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Payment term	15 days
Maximum [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Payment term	45 days
Tire Road Hazard Warranty [Member] | Minimum [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue recognition, contract term	21 months
Tire Road Hazard Warranty [Member] | Maximum [Member]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue recognition, contract term	36 months

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Revenue (Narrative) (Performance Obligation) (Details) $ in Millions	Mar. 27, 2021 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-03-26
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenue, performance obligation	$ 12.0
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-03-25
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Deferred revenue, performance obligation	$ 4.7

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Revenue (Schedule Of Disaggregated Revenue By Product Group) (Details) - USD ($) $ in Thousands		12 Months Ended
		Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Disaggregation of Revenue [Line Items]
Revenues		$ 1,125,721	$ 1,256,524	$ 1,200,230
Brakes [Member]
Disaggregation of Revenue [Line Items]
Revenues		130,179	169,138	162,709
Exhaust [Member]
Disaggregation of Revenue [Line Items]
Revenues		20,201	25,058	28,713
Steering [Member]
Disaggregation of Revenue [Line Items]
Revenues		85,290	100,230	95,711
Tires [Member]
Disaggregation of Revenue [Line Items]
Revenues	[1]	617,815	634,513	601,295
Maintenance [Member]
Disaggregation of Revenue [Line Items]
Revenues		269,337	324,494	308,668
Other [Member]
Disaggregation of Revenue [Line Items]
Revenues		$ 2,899	$ 3,091	$ 3,134

[1] Includes the sale of tire road hazard warranty agreements and tire delivery commissions.

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Revenue (Schedule Of Changes In Deferred Revenue) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020
Revenue [Abstract]
Balance	$ 18,506	$ 17,150
Deferral of revenue	14,958	17,466
Deferral of revenue from acquisitions	1,225	2,916
Recognition of revenue	(17,977)	(19,026)
Balance	$ 16,712	$ 18,506

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Income Taxes (Narrative) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019	Mar. 31, 2018
State net operating loss carryforwards available	$ 7,500
Federal net operating loss carrybacks	3,500
Unrecognized tax benefits	5,035	$ 5,212	$ 6,424	$ 6,209
Interest and penalties accrued related to unrecognized tax benefits	$ 200	$ 300
Tax Year 2018 [Member]
Fiscal years under examination	2018
Tax Year 2019 [Member]
Fiscal years under examination	2019
Tax Year 2020 [Member]
Fiscal years under examination	2020

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Income Taxes (Components Of Provision For Income Taxes) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Current -
Federal	$ (1,809)	$ 2,783	$ 5,682
State	827	1,994	2,409
Total current	(982)	4,777	8,091
Deferred -
Federal	10,169	11,397	11,563
State	685	76	954
Total deferred	10,854	11,473	12,517
Total provision	$ 9,872	$ 16,250	$ 20,608

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Income Taxes (Reconciliation Between Federal Statutory Tax Rate And Effective Tax Rate Reflected In Accompanying Financial Statements) (Details)		12 Months Ended
		Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Reconciliation between Federal statutory tax rate and effective tax rate reflected in accompanying financial statements
Expected U.S. federal income taxes at statutory rate, percentage		21.00%	21.00%	21.00%
State income taxes, net of federal income tax benefit, percentage		2.90%	1.90%	2.80%
Tax settlements and adjustments, percentage	[1]	(1.10%)		(1.90%)
Other, percentage		(0.50%)	(1.00%)	(1.40%)
Effective tax rate, percentage		22.30%	21.90%	20.50%

[1] For 2021, adjustments reflect benefit due to differences in statutory tax rates from loss years to years in which net operating losses may be carried back. For 2019, settlements reflect benefit from Internal Revenue Service’s examination of our 2016 and 2017 tax returns.

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Income Taxes (Deferred Tax (Liabilities) Assets) (Details) - USD ($) $ in Thousands	Mar. 27, 2021	Mar. 28, 2020
Deferred tax (liabilities) assets
Lease liabilities	$ (148,496)	$ (131,484)
Goodwill	(56,623)	(47,204)
Property and equipment	(21,032)	(18,232)
Other	(910)	(1,288)
Total deferred tax liabilities	(227,061)	(198,208)
Leased assets	186,168	169,366
Insurance reserves	11,441	10,192
Other	15,282	14,765
Total gross deferred tax assets	212,891	194,323
Total net deferred tax liability	$ (14,170)	$ (3,885)

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Income Taxes (Income Taxes Associated With Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Income taxes associated with unrecognized tax benefits
Unrecognized Tax Benefits, Beginning Balance	$ 5,212	$ 6,424	$ 6,209
Tax positions related to current year:
Additions	915	644	1,178
Tax positions related to prior years:
Additions			166
Reductions		(30)	(6)
Lapses in statutes of limitations	(1,092)	(1,826)	(1,123)
Unrecognized Tax Benefits, Ending Balance	$ 5,035	$ 5,212	$ 6,424

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Stock Ownership (Narrative) (Details) - $ / shares	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020
Stock Ownership [Abstract]
Class C convertible preferred stock, conversion value	$ 0.064	$ 0.064
Distribution amount per share of preferred stock on liquidation of company	$ 1.50
Minimum percentage of preferred stock holders approval for authorization of action	60.00%

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Share Based Compensation (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions		12 Months Ended
	Apr. 05, 2021	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense		$ 2.4	$ 3.8	$ 4.0
Tax benefit from compensation expense		0.6	$ 0.9	$ 1.0
Unrecognized compensation expense related to non-vested fixed stock options		$ 2.7
Compensation expenses recognition period related to nonvested fixed stock options		3 years
Weighted average fair value of options granted		$ 12.53	$ 18.92	$ 15.44
Fair value of awards vested under the Company's stock plans		$ 2.0	$ 2.0	$ 2.8
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of employee options		4 years
Employee options term		6 years
Stock Options [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of employee options		3 years
Stock Options [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of employee options		4 years
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expense related to non-vested fixed stock options		$ 1.4
Compensation expenses recognition period related to nonvested fixed stock options		2 years
Share-based compensation stock units granted		35,019
Weighted-average grant-date fair value per share, Granted		$ 52.75	$ 75.33	$ 67.80
Fair value of restricted stock awards vested		$ 1.4	$ 1.8	$ 1.0
Restricted Stock [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of employee options		3 years
Restricted Stock [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of employee options		4 years
Incentive Stock Option Plan 2007 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common shares authorized for issuance		5,001,620
Options available for grant		1,064,945
Chief Executive Officer [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation stock units granted	40,000
Senior Management [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of employee options		3 years	3 years	3 years

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Share Based Compensation (Summary Of Changes In Outstanding Stock Options) (Details)	12 Months Ended
	Mar. 27, 2021 $ / shares shares
Summary of changes in outstanding stock options
Options outstanding, beginning balance	802,766
Options outstanding, granted	166,193
Options outstanding, exercised	(130,998)
Options outstanding, canceled	(324,094)
Options outstanding, ending balance	513,867
Options, vested and exercisable	286,549
Weighted average exercise price, beginning of period | $ / shares	$ 58.55
Weighted average exercise price, granted | $ / shares	55.29
Weighted average exercise price, exercised | $ / shares	47.93
Weighted average exercise price, canceled | $ / shares	56.14
Weighted average exercise price, end of period | $ / shares	61.75
Weighted average exercise price, vested and exercisable | $ / shares	$ 61.30
Weighted average remaining contractual term (years), options outstanding	3 years 1 month 13 days
Weighted average remaining contractual term (years), vested and exercisable	1 year 11 months 4 days
Aggregate value, options outstanding	3,483,001	[1]
Aggregate value, vested and exercisable	1,805,603	[1]

[1] Total shares valued at the market price of the underlying stock as of March 27, 2021 less the exercise price.

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Share Based Compensation (Share-based Compensation Stock Option Excercises) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Exercise of stock options	$ 6,278	$ 6,171	$ 14,640
Stock Options [Member]
Total intrinsic value of stock options exercised	1,500	2,900	7,400
Exercise of stock options	$ 6,300	6,200	14,600
Income tax benefit		$ 400	$ 1,000

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Share Based Compensation (Summary Of Stock Options Outstanding) (Details)	12 Months Ended
	Mar. 27, 2021 $ / shares shares
Exercise Price Range One [Member]
Summarizes information about fixed stock options outstanding
Range of exercise price, lower limit	$ 40.71
Range of exercise price, upper limit	$ 55.15
Options outstanding, shares under option | shares	129,817
Options outstanding, weighted average remaining life	3 years 9 months 7 days
Options outstanding, weighted average exercise price	$ 50.86
Options exercisable, shares under option | shares	53,993
Options exercisable, weighted average remaining life	2 years 4 months 6 days
Options exercisable, weighted average exercise price	$ 47.88
Exercise Price Range Two [Member]
Summarizes information about fixed stock options outstanding
Range of exercise price, lower limit	55.16
Range of exercise price, upper limit	$ 57.78
Options outstanding, shares under option | shares	131,696
Options outstanding, weighted average remaining life	2 years 11 months 4 days
Options outstanding, weighted average exercise price	$ 56.97
Options exercisable, shares under option | shares	66,393
Options exercisable, weighted average remaining life	10 months 9 days
Options exercisable, weighted average exercise price	$ 57.28
Exercise Price Range Three [Member]
Summarizes information about fixed stock options outstanding
Range of exercise price, lower limit	57.79
Range of exercise price, upper limit	$ 66.90
Options outstanding, shares under option | shares	134,126
Options outstanding, weighted average remaining life	2 years 4 months 9 days
Options outstanding, weighted average exercise price	$ 64.38
Options exercisable, shares under option | shares	113,151
Options exercisable, weighted average remaining life	2 years 10 days
Options exercisable, weighted average exercise price	$ 64.37
Exercise Price Range Four [Member]
Summarizes information about fixed stock options outstanding
Range of exercise price, lower limit	66.91
Range of exercise price, upper limit	$ 87.17
Options outstanding, shares under option | shares	118,228
Options outstanding, weighted average remaining life	3 years 5 months 26 days
Options outstanding, weighted average exercise price	$ 76.04
Options exercisable, shares under option | shares	53,012
Options exercisable, weighted average remaining life	2 years 7 months 13 days
Options exercisable, weighted average exercise price	$ 73.44

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Share Based Compensation (Summary Of Restricted Stock) (Details) - Restricted Stock [Member] - $ / shares	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares, Nonvested	55,730
Shares, Granted	35,019
Shares, Vested	(26,333)
Shares, Forfeited	(12,703)
Shares, Nonvested	51,713	55,730
Weighted-average grant-date fair value per share, Nonvested	$ 64.96
Weighted-average grant-date fair value per share, Granted	52.75	$ 75.33	$ 67.80
Weighted-average grant-date fair value per share, Vested	56.52
Weighted-average grant-date fair value per share, Forfeited	63.90
Weighted-average grant-date fair value per share, Nonvested	$ 61.24	$ 64.96

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Earnings Per Common Share (Narrative) (Details) - shares shares in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Earnings Per Common Share [Abstract]
Antidilutive securities excluded from computation of earnings per share	456	177	146

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Earnings Per Common Share (Reconciliation Of Basic And Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Numerator for earnings per common share calculation:
Net income	$ 34,319	$ 58,024	$ 79,752
Less: Preferred stock dividends	(438)	(449)	(408)
Income available to common shareholders	$ 33,881	$ 57,575	$ 79,344
Denominator for earnings per common share calculation:
Weighted average common shares, basic	33,329	33,246	32,980
Effect of dilutive securities:
Preferred stock	503	510	510
Weighted average common shares - diluted	33,876	33,953	33,675
Basic earnings per common share:	$ 1.02	$ 1.73	$ 2.41
Diluted earnings per common share:	$ 1.01	$ 1.71	$ 2.37
Stock Options [Member]
Effect of dilutive securities:
Share based payment arrangements (in shares)	26	167	154
Restricted Stock [Member]
Effect of dilutive securities:
Share based payment arrangements (in shares)	18	30	31

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Leases (Narrative) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 30, 2019	Mar. 28, 2020
Sale Leaseback Transaction [Line Items]
Finance lease and financing obligation assets, net	$ 275,360		$ 196,575
Long-term finance leases and financing obligations	366,330		298,373
Lease payments, leases signed but not yet commenced	2,400
Rent expense under operating leases, net of sublease income		$ 38,000
Amortization of finance (capital) lease assets		$ 14,700
Failed Sale Leasebacks That Were Assumed Through Acquisitions [Member]
Sale Leaseback Transaction [Line Items]
Finance lease and financing obligation assets, net	4,400		4,500
Long-term finance leases and financing obligations	$ 7,200		$ 7,500
Minimum [Member]
Sale Leaseback Transaction [Line Items]
Remaining lease term	1 year
Option to extend, term of option	3 years
Maximum [Member]
Sale Leaseback Transaction [Line Items]
Remaining lease term	37 years
Option to extend, term of option	25 years

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Leases (Schedule Of Operating And Finance Lease Costs) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020
Leases [Abstract]
Operating lease cost	$ 35,998	$ 38,525
Amortization of leased assets	30,428	21,033
Interest on lease liabilities	18,344	21,330
Short term and variable lease cost	321	2,194
Sublease income	(95)	(166)
Total lease cost	$ 84,996	$ 82,916

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Leases (Schedule Of Future Maturities of Lease Liabilities) (Details) $ in Thousands	12 Months Ended
	Mar. 27, 2021 USD ($)
Operating Leases:
2022	$ 36,451	[1]
2023	34,381	[1]
2024	31,685	[1]
2025	28,414	[1]
2026	25,161	[1]
Thereafter	83,454	[1]
Total undiscounted lease obligations	239,546	[1]
Less: imputed interest	(30,919)	[1]
Present value of lease obligations	208,627	[1]
Finance Leases and Financing Obligations:
2022	55,389	[2],[3]
2023	55,487	[3]
2024	54,405	[3]
2025	51,494	[3]
2026	48,992	[3]
Thereafter	250,812	[2],[3]
Finance lease commitments/financing obligations, Total	516,579	[2],[3]
Less: imputed interest	(112,446)	[3]
Present value of lease obligations	404,133	[3]
Finance lease payments, related to options to extend, reasonable certain of being exercised	108,400
Operating lease payments, related to options to extend, reasonably certain of being exercised	$ 61,000

[1] Operating lease obligations include $61.0 million related to options to extend operating leases that are reasonably certain of being exercised.

[2] Finance and operating lease commitments represent future undiscounted lease payments and include $108.4 million and $61.0 million, respectively, related to options to extend lease terms that are reasonably certain of being exercised.

[3] Finance lease payments include $108.4 million related to options to extend finance leases that are reasonably certain of being exercised.

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Leases (Schedule Of Weighted Average Remaining Lease Terms And Discount Rates) (Details)	Mar. 27, 2021	Mar. 28, 2020
Operating Leases
Weighted average remaining lease term, in years	8 years 7 months 6 days	9 years 4 months 24 days
Weighted average discount rate	2.96%	3.51%
Finance Leases and Financing Obligations
Weighted average remaining lease term	10 years 3 months 18 days	9 years 10 months 24 days
Weighted average discount rate	6.20%	8.73%

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Leases (Schedule Of Supplemental Cash Flow Information Related To Leases) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020
Leases [Abstract]
Operating cash flows from operating leases	$ 34,931	$ 36,808
Operating cash flows from finance leases and financing obligations	18,602	21,340
Financing cash flows from finance leases and financing obligations	$ 33,032	$ 27,212

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Defined Benefit and Defined Contribution Plans (Narrative) (Details) - USD ($)	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Defined Benefit and Defined Contribution Plans [Abstract]
Charges to expense for the Company's matching contributions	$ 1,600,000	$ 1,700,000	$ 1,400,000
Total liability, Deferred Compensation Plan	2,100,000	$ 2,200,000
Expected contributions for fiscal 2022	$ 0

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Defined Benefit and Defined Contribution Plans (Pension Benefit Payments) (Details) $ in Thousands	Mar. 27, 2021 USD ($)
Defined Benefit and Defined Contribution Plans [Abstract]
2022	$ 1,065
2023	1,098
2024	1,114
2025	1,147
2026	1,188
2027-2031	$ 6,322

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Defined Benefit and Defined Contribution Plans (Components Of Pension Income) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Defined Benefit and Defined Contribution Plans [Abstract]
Interest cost on projected benefit obligation	$ 692	$ 752	$ 781
Expected return on plan assets	(1,162)	(1,423)	(1,409)
Amortization of unrecognized actuarial loss	892	455	403
Net pension income	$ 422	$ (216)	$ (225)

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Defined Benefit and Defined Contribution Plans (Weighted Average Assumptions Used To Determine Benefit Obligations) (Details)	Mar. 27, 2021	Mar. 28, 2020
Defined Benefit and Defined Contribution Plans [Abstract]
Discount rate	3.01%	3.34%

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Defined Benefit and Defined Contribution Plans (Weighted Average Assumptions Used To Determine Net Periodic Pension Costs) (Details)	12 Months Ended
	Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Defined Benefit and Defined Contribution Plans [Abstract]
Discount rate	3.34%	3.72%	3.89%
Expected long-term return on assets	6.50%	7.00%	7.00%

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Defined Benefit and Defined Contribution Plans (Funded Status Of Plan) (Details) - USD ($) $ in Thousands	12 Months Ended
	Mar. 27, 2021		Mar. 28, 2020		Mar. 30, 2019
Change in Plan Assets:
Fair value of plan assets at beginning of year	$ 18,611		$ 20,838
Actual return (loss) on plan assets	3,688		(1,507)
Benefits paid	(633)		(720)
Fair value of plan assets at end of year	21,666		18,611		$ 20,838
Change in Projected Benefit Obligation:
Benefit obligation at beginning of year	21,646	[1]	20,972
Interest cost	692		752		781
Actuarial loss	391		642
Benefits paid	(633)		(720)
Benefit obligation at end of year	22,096	[1]	21,646	[1]	$ 20,972
Underfunded status of plan	$ (430)		$ (3,035)

[1] Accumulated benefit obligation-the present value of benefits earned to date assuming no future salary growth-is materially consistent with the projected benefit obligation in each period presented.

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Defined Benefit and Defined Contribution Plans (Company's Asset Allocations By Asset Category) (Details)	Mar. 27, 2021	Mar. 28, 2020
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Current Targeted Plan Asset Allocations	100.00%
Defined Benefit Plan, Actual Plan Asset Allocations	100.00%	100.00%
Cash and Cash Equivalents [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Actual Plan Asset Allocations	53.30%	4.10%
Fixed Income [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Current Targeted Plan Asset Allocations	50.00%
Defined Benefit Plan, Actual Plan Asset Allocations	24.70%	37.90%
Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Defined Benefit Plan, Current Targeted Plan Asset Allocations	50.00%
Defined Benefit Plan, Actual Plan Asset Allocations	22.00%	58.00%

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Defined Benefit and Defined Contribution Plans (Fair Value Measurement Information For Major Categories Of Defined Benefit Plan Assets) (Details) - USD ($) $ in Thousands		Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Defined Benefit Plan Disclosure [Line Items]
Fair value measurement of defined benefit plan assets		$ 21,666	$ 18,611	$ 20,838
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value measurement of defined benefit plan assets			18,611
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | U.S. Companies Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value measurement of defined benefit plan assets	[1]	3,372	7,383
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | International Companies Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value measurement of defined benefit plan assets	[1]	1,391	3,137
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Cash and Cash Equivalents [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value measurement of defined benefit plan assets	[1]	11,542	761
Significant Other Observable Inputs (Level 2) [Member] | U.S. Companies Equity Securities [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value measurement of defined benefit plan assets	[1]		283
Significant Other Observable Inputs (Level 2) [Member] | U.S. Corporate Bonds Fixed Income [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value measurement of defined benefit plan assets	[1]	$ 5,361	6,686
Significant Other Observable Inputs (Level 2) [Member] | International Bonds [Member]
Defined Benefit Plan Disclosure [Line Items]
Fair value measurement of defined benefit plan assets	[1]		$ 361

[1] Fair value measurements are reported in one of three levels based on the lowest level of significant input used: Level 1 (unadjusted quoted prices in active markets); Level 2 (observable market inputs, other than quoted prices included in Level 1); and Level 3 (unobservable inputs that cannot be corroborated by observable market data).

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Defined Benefit and Defined Contribution Plans (Amounts Recognized In Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Thousands		Mar. 27, 2021	Mar. 28, 2020
Defined Benefit and Defined Contribution Plans [Abstract]
Unamortized net actuarial loss		$ 6,147	$ 9,174
Amounts in Accumulated Other Comprehensive Loss	[1]	6,147	9,174
Amounts in Accumulated Other Comprehensive Loss, net of tax		$ 4,619	$ 6,889

[1] $4,619 and $6,889, net of tax, at the end of 2021 and 2020, respectively.

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Defined Benefit and Defined Contribution Plans (Changes In Plan Assets And Benefit Obligations Recognized In Other Comprehensive (Loss) Income) (Details) - USD ($) $ in Thousands		12 Months Ended
		Mar. 27, 2021	Mar. 28, 2020	Mar. 30, 2019
Defined Benefit and Defined Contribution Plans [Abstract]
Net actuarial income (loss)		$ 3,027	$ (3,117)	$ (382)
Amounts in Other Comprehensive Income (Loss)	[1]	3,027	(3,117)	(382)
Amounts in Other Comprehensive Income (Loss), net of tax		$ 2,270	$ (2,353)	$ (288)

[1] $2,270, ($2,353) and ($288), net of tax, during 2021, 2020 and 2019, respectively.

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Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Thousands		12 Months Ended
		Mar. 27, 2021	Mar. 28, 2020
Rent deferrals		$ 800
Timing of lease related expenses		1,000
Finance lease and financing obligation assets, net		275,360	$ 196,575
Finance leases liability	[1]	404,133
Operating lease assets, net		203,329	$ 199,729
Operating lease obligations	[2]	$ 208,627
Re-negotiated Rental Payments [Member]
Percent of leases re-negotiated		23.00%
Finance lease and financing obligation assets, net		$ 67,700
Finance leases liability		64,000
Operating lease assets, net		16,200
Operating lease obligations		$ 20,000

[1] Finance lease payments include $108.4 million related to options to extend finance leases that are reasonably certain of being exercised.

[2] Operating lease obligations include $61.0 million related to options to extend operating leases that are reasonably certain of being exercised.

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Commitments and Contingencies (Schedule Of Payments Due By Period) (Details) - USD ($) $ in Thousands		12 Months Ended
		Mar. 27, 2021	Mar. 28, 2020
Commitments and Contingencies [Abstract]
Principal payments on long-term debt, Total		$ 190,000	$ 566,400
Principal payments on long-term debt, 4 to 5 years		190,000
Finance lease commitments/financing obligations, Total	[1],[2]	516,579
Finance lease commitments/financing obligations, Within 1 Year	[1],[2]	55,389
Finance lease commitments/financing obligations, 2 to 3 Years	[1]	109,892
Finance lease commitments/financing obligations, 4 to 5 Years	[1]	100,486
Finance lease commitments/financing obligations, After 5 Years	[1],[2]	250,812
Operating lease commitments, Total	[1]	239,546
Operating lease commitments, Within 1 year	[1]	36,451
Operating lease commitments, 2 to 3 years	[1]	66,066
Operating lease commitments, 4 to 5 years	[1]	53,575
Operating lease commitments, After 5 years	[1]	83,454
Accrued rent, Total		1,807
Accrued rent, Within 1 year		1,563
Accrued rent, 2 to 3 Years		132
Accrued rent, 4 to 5 Years		42
Accrued rent, After 5 Years		70
Other liabilities, Total		1,133
Other liabilities, Within 1 year		800
Other liabilities, 2 to 3 years		333
Contractual commitments, Total		949,065
Contractual commitments, Within 1 year		94,203
Contractual commitments, 2 to 3 years		176,423
Contractual commitments, 4 to 5 years		344,103
Contractual commitments, After 5 years		334,336
Operating lease payments, related to options to extend, reasonably certain of being exercised		61,000
Finance lease payments, related to options to extend, reasonable certain of being exercised		$ 108,400

[1] Finance and operating lease commitments represent future undiscounted lease payments and include $108.4 million and $61.0 million, respectively, related to options to extend lease terms that are reasonably certain of being exercised.

[2] Finance lease payments include $108.4 million related to options to extend finance leases that are reasonably certain of being exercised.

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Subsequent Events (Narrative) (Details)	1 Months Ended
	May 31, 2021 $ / shares
Subsequent Event [Line Items]
Common stock cash dividends per share declared	$ 0.24
Subsequent Event [Member]
Subsequent Event [Line Items]
Dividends payable, date of record	Jun. 07, 2021
Cash dividend date to be paid	Jun. 21, 2021